Print

Shandong Yulong’s polyolefin auction on 23 October presented a divided market landscape, with PE grades outperforming PP amid ongoing operational uncertainty and sanction-related headwinds.

LLDPE film stood out as the day’s best performer, achieving full sell-out at slightly higher prices compared to the previous session. Strong participation reflected steady packaging demand and tighter availability, though total offered volume was notably smaller than earlier in the week. HDPE film also recorded decent activity, clearing around 40% of its allocation, while other HDPE grades managed limited sales.

In contrast, the PP segment remained muted, with no deals concluded for either homo-PP yarn or block copolymer. Buyers remained hesitant despite competitive offers, citing weak downstream demand and concerns surrounding the producer’s operational stability.

“There have been market talks surrounding the production cuts at the plant due to persistent weak demand and the sanction issue that has affected its sales,” a local trader said. “Some state-owned companies are reportedly avoiding trades involving its cargoes. Although there has been no official announcement regarding the plant’s status, the smaller auction volume suggests reduced output, and we expect limited cargo availability in the near term.”

Market participants noted that today’s strong PE performance may have been partly influenced by constrained supply rather than improved demand. With uncertainty surrounding Yulong’s operating rates and sales channels, sentiment across both PP and PE markets remains cautious. Unless feedstock prices recover or downstream demand improves, near-term trading activity is likely to stay subdued.

Written by: Kat Yun Yun
Edited by: Aiman Haikal

Country
China