Chinese companies in March increased exports of polypropylene (PP) to a historic high of 257.1 thousand tons, which is almost 7 times higher than the average monthly supply volumes during 2018-2020, the Plastinfo.ru outlet reported on Thursday with reference to the Argus Media agency.
The main drivers of the increase are the rise of the country’s production capacity and opened up arbitrage window for the shipments from China due to the PP shortage in overseas markets, according to the report.
The commissioning of new plants with a total PP production capacity of 3.8 million tons annually resulted in the decrease of China's dependence on PP imports in the first quarter of 2021 to 15%.
New PP plants with a total capacity of 5 million tons per year are expected to launch this year, which will allow the country to strengthen its position in the export market in the long term.
A shortage of polypropylene in the global markets due to unscheduled plant shutdowns in the U.S. state of Texas in February led to higher PP prices and the opening of arbitrage window for shipments from China. As a result, Chinese companies in March shipped 43.9 thousand tons of PP to India, 35.9 thousand tons of PP to Turkey, 31.5 thousand tons of PP to Vietnam, 23 thousand tons of PP to Pakistan and 15.6 thousand tons of PP to Brazil.