Vietnam PP market: Sentiment improved slightly; strong rebound less likely   

Import homo-PP yarn to Vietnam has been constantly inching lower since late May given the persistent weak demand condition and the recent steep depreciation of the local currency hampered purchasing interest further.

Compared to the cyclical peak during mid-may, the average price for import homo-PP flat yarn based on CIF Vietnam, LC AS term fell approximate $65/ton by the week ending 27 July. The lower end of the overall price range observed in the previous week has not repeated this week, while most overseas suppliers started showing firmer stance, signaling a possibility that the bottom is very near.     

“Most of the suppliers we contacted either claimed sold out for yarn grade or refused additional discount. We plan to start making replenishment with expectation that room for further reduction might be very narrow now,” a woven bag manufacturer commented.

Several other international suppliers confirmed that buyers are more active in checking on offers, however, deals are still limited as exchange rate and end product demand prospect remain a big concern.

“Local demand is not great due to the monsoon season, and therefore we are a bit hesitating at the moment,” another converter said while adding that Omani maker firm on the price level $1240/ton CIF Vietnam, LC AS.

Players are also waiting for new offers from a major Thailand producer, who has been pioneering price cuts for the past several months. “Middle Eastern suppliers are very reluctant in reducing offers due to lacking quantity, however, Thailand producer is more aggressive. Market would regain stabilization if the downward pressure from duty-free origin drop,” another market source added.

It is clear that overseas sellers are working very hard to limit any further price erosion in import homo-PP yarn market, yet, no strong rebound is expected. Trading activities might see a real come back by second half of August as the manufacturing season kick-start, “And from now until then, it is good for the market to stabiles,” an international trader added.