China PP Imports Declined with Closed Arbitrage Window
Preface
SCI Plastic leads you into polypropylene (PP) import data by origin, trade modes and import cost, to clearly present China’s PP import market change between January and February 2023.
1. China PP Import Volume Trend
China’s PP import volume declined in January 2023, as overseas producers provided fewer quotations to China’s buyers. The import volume continued falling in February with arbitrage window closed. China’s domestic PP prices were lower than import prices, and their price spread widened with the exchange rate of RMB value against USD value softening, which suggested that the import arbitrage window was closed. Overseas suppliers showed softened enthusiasm for selling goods to China and cut back the number of quotations. They preferred to export goods to other regions for profit maximum. However, China’s PP import volume was around 545.49kt between January and February 2023, up 26.13% Y-O-Y.
2. Jan-Feb 2023 China PP Import Data by Origin
The total import volume of PP decreased by 6.7kt M-O-M in February 2023. The rank of import origins changed. Among PP import origins, South Korea still ranked first, and its export volume to China was 53.8kt in February. Saudi Arabia and U.A.E. exported 34.1kt and 31.9kt of PP cargoes to China, coming after South Korea. China’s PP imports from Japan ranked fourth with volume rising to 23.5kt or so. In addition, PP imports from Russia, Singapore and Taiwan of China ranked fifth, sixth and seventh separately, and those from Kazakhstan climbed to eighth place.
3. Jan-Feb 2023 China PP Import Data by Trade Mode
In February, China’s PP import volume via general trade mode was about 178.7kt and took up 66.33% of the total, down 2% M-O-M. The import volume via processing trade with imported materials was about 45.5kt. That occupied 16.92% of total imports, growing by 5% M-O-M. Besides, the import volume of stored and transit goods in bonded warehouses was about 38.3kt and occupied around 14.21% of the total, which dropped by 4% M-O-M. In summary, general trade was still the prominent trade mode. Due to the continuous closure of the import arbitrage window, the trade mode changed, and the import volume based on the trade mode of processing trade with imported materials rose to second place. The import volume based on the trade mode of stored and transit goods in bonded warehouses accounted for a smaller proportion compared with the previous month, while that based on the mode of processing trade with provided materials maintained a largely stable proportion.
4. Jan-Feb 2023 China PP Import Data by Import Cost
The overall import cost saw a marginal increment in February 2023 and mainly hovered around $800-1,200/mt. Therein, imports with import costs of $900-1,000/mt ranked first, and major origins were U.A.E., Saudi Arabia and India. Imports with costs of $1,100-1,200/mt ranked second, and origins were mainly South Korea, Taiwan of China and Singapore. Imports with costs of $800/mt took the third place, and origins were mainly Russia, Japan and Malaysia. Imports with costs of $1,000-1,100/mt ranked fourth, and main origins were Singapore, South Korea and Thailand.
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