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CHINA

Domestic spot market remain unaffected by the two falling session streak on futures trading. In contrast, traders are reporting satisfactory number of deals for both PP and PE with only a small discount of CNY50-100/ton ($8-15/ton).

Thanks to the steady sentiment and persistent healthy buying interest, total PP and PE inventory at major domestic producers’ warehouses quickly drop about 30,000 tons today, to approximate 620,000 tons. Sales pressure is minimal at this level.

The import HDPE film market is loosing momentum with prices at the upper end of the overall range softened slightly compared to last week, in line with players’ expectation for a minor price correction. Offers for both Thailand and Taiwan origin slip $10/ton week on week to $1350/ton and 1360/ton respectively. “Availability is limited. Buyers are more attracted to re-export cargoes with shorter lead time, and yet we are in no rush to cut offers deeply,” a distributor commented.

SOUTHEAST ASIA

• December shipment negotiation on-going
• Limited supply is the centre of the market

Polyethylene (PE)

Trading activities in Southeast Asia remain mediocre given the fact that players are in mid of negotiation for December shipment. Major Saudi Arabia producer announced fresh PP and PE offers to the region late last week with $70/ton hike for HDPE film while slashing homo-PP and LLDPE film prices by $40/ton has rejected all other lower bids while insisting to close deals at the offered levels. Market is not responding positively to the move with a number of buyers decided to withdraw instead of raising bids.

Several deals for import Middle Eastern LLDPE film are reported in Vietnam in the range $1170-1190/ton CIF, LC AS term for late December arrival. A number of other indication pointing to a possibility that import LLDPE film market is nearing the bottom, including the fact that a major South Korean maker insist to keep offer for this grade at $1220/ton even bids from serious buyers come in at only $20/ton lower.

Polypropylene (PP)

Local traders in Indonesia started showing a more optimistic view over the near term outlook for PP market after managed to deplete most of the cargoes on hand. Buyers here rush to source domestic cargoes seeing a small rebound in import ground. Deals are seen in the range IDR 16,350,000-16,700,000/ton ($1209-1235/ton) without VAT, FD Indonesia, cash term. “It does appear that PP market might not reduce any further in the near term. We have procured sufficient stock till end of January. We can now wait with peace of mind,” a woven bag converter said.

Vietnamese buyers have accepted dutiable homo-PP cargoes at $1160/ton CIF, LC AS term, officially eliminating hope to obtain deals below the $1150/ton threshold. “At the moment, we are looking to lift deal done level to $1170/ton,” an international trader added.