Ahead of Lunar New Year, the typical “wind-down” in the SEA PPG market, fewer deals and a largely sideways price pattern is not merely a temporary pause, but a positioning phase for both sides. Buyers usually prioritize operational continuity and inventory control rather than taking directional bets, while sellers try to defend headline levels to avoid sending a bearish price signal in a low-liquidity window. This backdrop has been evident recently as SEA flexible slabstock PPG levels continued to correct toward more workable ranges, reflecting soft buying appetite and deal-making driven mainly by lot-by-lot negotiation rather than a demand-led upcycle.
As business normalizes after the holiday, the most common scenario is a brief shift to a firmer tone, and in some cases a slight uptick in offer levels, but not necessarily a sustainable uptrend. The reason is that the initial reopening period often brings basic restocking needs to restore minimum operating coverage, while logistics, documentation, and delivery schedules normalize with a lag, making prompt cargo more timing-sensitive. In this phase, bid–offer spreads can widen and sellers may hold firmer offers, yet traded volumes remain selective. The market then quickly returns to a fundamentals test: if downstream restarts gradually and orders do not improve meaningfully, buyers typically revert to a cautious stance, purchasing in smaller clips and staying hand-to-mouth, consistent with a market that is currently negotiation- and inventory-driven rather than supported by a clear demand cycle.
A key determinant of whether post-holiday firmness can extend lies on the cost side, especially the direction of propylene oxide (PO). When upstream does not confirm, post-holiday price push attempts tend to lack durability. In the recent context, China’s PO has moved into a corrective phase as downstream resistance intensified, reinforcing the view that replacement-cost pressure is easing and the market’s “panic floor” is lower. This caps the probability of a strong and sustained rebound in PPG after LNY unless a new supply-demand catalyst emerges or a sufficiently disruptive supply/logistics event reshapes market narratives.
Meanwhile, logistics typically contributes more to short-term availability volatility than to a structurally bullish pricing trend. Before the holiday, the market often sees a “rush” effect that can keep freight and schedules steady or slightly firmer as participants move cargo ahead of shutdowns, but post-holiday logistics impact is most visible in timing-based price dispersion: prompt parcels may carry a premium, while forward shipments remain more negotiable, particularly if downstream has not recovered strongly.
In addition, headline and policy risks remain wildcards that can generate sharp but short-lived price reactions immediately after the holiday. The market has already shown sensitivity to policy-linked narratives, where concerns can lift offers quickly for a brief period, only to retreat back toward workable levels when there is no real demand absorption. This highlights that any post-LNY upticks, if they occur, may be more technical and sentiment-driven, and will be tested quickly by downstream’s true purchasing power.
From a consulting perspective, the most practical stance is to prepare for a post-LNY market that may feel firmer in tone but does not necessarily recover strongly in volume. For sellers, an effective approach is to manage prompt availability carefully and structure offers in two layers: a level that captures a timing premium for prompt/nearby deliveries and a more flexible level for forward laycans, rather than attempting a broad market-wide price lift when upstream support is limited. For buyers, the priority is to secure minimum operating inventory to avoid post-holiday delivery delays, while splitting procurement into two to three buying tranches to reduce the risk of locking in at a “technical high” during the reopening phase. In a baseline that remains cautious and negotiation-led, a staged and delivery-window-driven approach is typically more resilient than a one-shot bet on a major uptrend.
