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In China, futures prices on Dalian Commodity Exchange continue the firming trend today with PP contract closed at CNY17/t ($3/t) higher than last week to reach CNY7423/t ($978/t without VAT), and LLDPE contract gained CNY75/t ($12/t) at CNY9525/t ($1254/t without VAT).

Domestic spot offers for PP recorded a notable gain today at CNY200-500/t ($31-77/t) higher than late last week while PE cargoes see more humble increases at only CNY50-200/t ($8-31/t). Trading activities are reported to be better, yet many sellers elected to suspend their offering toward the afternoon session with hope seeing higher prices in the near term.

A trader in Zhejiang said, “We wish to speed up sales, hence we maintained our offers stable compared to last week despite drastic increases at the background. We are having sufficient material to supply regular quantity to our customers and demand in Eastern China appears to be better than other areas. At the moment, we are focusing more on local market as export takes longer time to receive payment. We expect the market would continue to firm up in the coming days.”

In the import market, traders have lifted import homo-PP offers to above $1000/t threshold; prices below this level are becoming scarce. “We are receiving more enquiries from regular buyers today as local prices recorded a big jump. However, customers are not very interested in such high prices, hence the number of deal concluded is rather small. Many traders have secured sufficient cargoes from domestic sources previously and they are not in rush to replenish material,” a distributor in Ningbo reported.

Another trader in Shanghai added, “Sales for import PE cargoes are not that good and our customers are complaining about high prices. Yet, we are not expecting any price reduction in the near term given firm upstream values and limited supply from both local and import market. We do think that the increase range for HDPE might be limited compared to LLDPE and LDPE due to the supply availability.”

In Southeast Asia, market started the new week on a very strong sentiment as limited supply continues to play a primary role in elevating the market. There is an inadequate number of PP offers observed in the market today, especially from Middle Eastern suppliers. Meanwhile, a Thai major decided to implement $50/t hike on their PP cargoes to Indonesia, marking six straight weeks of price increases, bringing homo-PP offers to above $1100/t level. A trader informed, “We were really amused of the firming trend in the import market. Local demand for homo-PP raffia is very healthy as woven bags makers are preparing for the harvest season. Many local traders are not offering any cargoes today as they expect higher prices in the near term.” In Vietnam, import coal based PP from China has also posted some $50-60/t gains compared to last week to reach $1050-1060/t CIF, LC AS term. A buyer received the offer added, “Local prices have also gain speed today and we think that this trend could sustain in the coming month. Market could even gain more support if major oil producers can agree on an output agreement this April 17.  Most of our suppliers are not offering today.”

The PE market is waiting for another fresh round of new price announcement with most player expected significant hike compared to last month. In fact, international suppliers are also expressing their intention to lift offers to above $1200/t level for both HDPE and LLDP film cargoes. Meanwhile, supply for LLDPE film within the region remains tight due to some plant issues taking place. An international trader commented, “We send inquiries to regular supplier for some LLDPE film cargoes, however they are not having any quantity available as a result of technical issues that their plant.” A Malaysian converter added, “Our local supplier has cancelled all LLDPE film orders and claimed short of supply. We might need to seek other source of supply in the coming days as we do not think the current condition could improve any time so soon.”

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