According to data from Statistical Instrumentation, China's total homo PP imports for the January-April 2022 period show the lowest figure since 2008.

The country's cumulative PPH imports in the first four months of 2022 remained below 1 million tons, down nearly 17% year-on-year.

The country's weak performance is mainly attributed to the strict anti-Covid-19 measures implemented in large areas, which not only impede daily life and trade flows but also affect to economic data. Shanghai's lockdown began at the end of March and lasted until June 1while the capitals Beijing and Tianjin went through a difficult period with local quarantines as well as mass testing. wide.

April data reflects weak demand conditions

April's data had the second smallest contribution to total imports at around 211,000 tons, reflecting weak demand for homo PP for the whole month. Meanwhile, February, when China usually has one of the longest holidays due to the Lunar New Year, ranked first with about 198,000 tons.

May volume is likely to be even lower

Amid China's uphill battle with the latest Covid-19 outbreak that began in late March, major financial sectors were severely restricted throughout May, resulting in logistics and manpower disruption due to measures to limit the movement of people and materials. Accordingly, the import volume in May is not expected to be better than in April.

Contributing further to this scenario is the reduced demand conditions throughout May. While most Chinese buyers are reluctant to make new purchases because of the pandemic, most foreign suppliers prefer to focus on markets. export markets other than China not only for higher profit but also to avoid logistics problems.

According to the average monthly data obtained from Price Instrument, the price of PP homo raffia and injection by China CIF method is at USD 1147/ton while the price for China domestic ex-warehousing method (excluding VAT) is 1145 USD/ton. The competitive advantage of local prices over imports is another factor that puts additional pressure on import demand, due to the impact of the yuan's devaluation against the USD.

China's domestic PP supply is expected to increase as capacity addition remains a concern.

China will welcome more than 3.5 million tons of new PP capacity in 2022