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In China, futures market extended the weakening trend. January delivery contract for PP slumped CNY137/ton ($21/ton) to reach CNY8662/ton ($1125/ton without VAT). LLDPE contract dipped CNY160/ton ($24/ton) to CNY9365/ton ($1216/ton without VAT).

Sentiment in domestic spot market deteriorated further, players said with the number of deals dropping fast. “We have not received many calls from customers today as many have made sufficient purchases on the first trading day of the week. However, we are not having any inventories pressure and remain optimistic about the near term outlook,” a trader said.

Private data showed that total PP and PE inventories at major domestic producers’ warehouses have dropped to about 748,000 tons as of today, indicating moderate level of sales pressure. Players are expecting demand for LLDPE and LDPE film to remain steady considering the peak demand season from the aggricultural film sector. “Even BOPP converters are receiving improved number of end product orders, and we are waiting for demand to come back. Softening futures market just pull buyers to the sideline and we think this is temporary,” another market source added.

In the import market, couple of overseas suppliers cut offers for PE by $10-20/ton from the pre-holiday week, bringing latest price list to $1180/ton for LLDPE film and $1230/ton for LDPE film, all based on CFR China, LC 60 days term. “We managed to close several deals given the limited quantity available. Many buyers prefer to source cargoes from the local ground and this is putting pressure on import market,” a source close to the producer said. Players noted that supply for HDPE film is especially tight.

Import PP market is stalled as buyers confidence is affected by competitive local materials and falling futures market. Traders are complaining about disappointed number of inquiries in spite of a clear tight supply condition.

In Southeast Asia, market remains largely calm into the week though more international producers are opening new offers. Buyers are pressing for discounts on both PP and PE cargoes, putting market on a tense tug-of-war position.

A Saudi Arabia producer rollover homo-PP offers to Vietnam in the previous trading session at $1180/to CIF, LC AS term, however facing difficulties in concluding deals at the same levels as previous weeks. Buyers are bidding well below the offered level, in the range $1130-1150/ton with the same term. A distributor source informed, “We are unable to accept the bid prices as it is too low. Demand is very weak, which might drag the sentiment down further. At the same time, supply is very tight, from which we strongly believe that prices are not going to drop in large range.”

In domesitc Indonesia market, supply for homo-PP is tightening up after traders depleted most of the on hand cargoes. Offers in the distribution market firmed up with prices below the $1250/ton excluding VAF, FD Indonesia, cash term are no longer available. At the meantime, Chandra Asri has restarted the 480,000 tons/year PP line this week and currently in the process of ramping up run rate. The line was shut during third week of September. The producer initially planned to postpone the shutdown to second week of October, however decided to bring forward the schedule.

Supply for HDPE film in the region is tight and producers are offering this grade at premium over LLDPE film. Thailand, Saudi Arabia and South Korean HDPE film prices are showing a premium of $20-40/ton over LLDPE film from the same origin. “Most overseas sellers are claiming tight availability and refusing to offer large discounts. Demand in Southeast Asia is too weak, which encourage sellers to divert cargoes to other markets, where margins are better,” a market source said.