SE Asia's Import PP Market Drops Below China in Rare Market Reversal

A rare shift has emerged in Asia’s polypropylene market, with import PP prices in Southeast Asia falling below those in China. The development marks an unusual reversal of a long-standing pricing pattern, as Southeast Asia has traditionally traded at a premium to China due to stronger regional demand and trade flow dynamics.

The change has been driven largely by weak demand across Southeast Asia. Buyers have remained cautious, purchasing only for immediate needs while maintaining low inventories. At the same time, ample supply and expectations of further price declines have intensified competition among suppliers, pushing prices lower across the region.

Import homo-PP and PP block copolymer prices in Southeast Asia have been under pressure since April, but the decline accelerated sharply in recent weeks. By mid-June, prices for both grades had fallen to their lowest levels in around three months.

Competitive pricing from major suppliers added further pressure to the market. South Korean producers emerged as some of the most aggressive sellers, particularly in Vietnam, offering material well below competing levels. Meanwhile, Middle Eastern suppliers also introduced highly competitive PP block copolymer offers as they sought to secure market share in a slow-demand environment.

As prices continued to weaken, Southeast Asia lost its traditional premium over China. Import homo-PP prices in the region were reported at roughly $60/ton below Chinese levels, while PP block copolymer prices traded around $25/ton lower. Such discounts are rarely seen and highlight the severity of the current demand weakness across Southeast Asia.

In contrast, China’s PP market has remained relatively firmer. Although demand there is not particularly strong, a series of maintenance shutdowns and lower operating rates have tightened domestic supply, preventing prices from falling as rapidly as in Southeast Asia.

Market participants now expect the pricing gap to eventually narrow, either through stabilization in Southeast Asian markets or a correction in China once maintenance-related supply constraints ease. For the time being, however, weak buying interest, sufficient inventories, and aggressive supplier competition are expected to keep pressure on Southeast Asian PP prices.

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