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Asia Daily PP and PE Overview 28 December 2017Asia Daily PP and PE Overview 28 December 2017 |
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CHINA
Polypropylene (PP)
The PP market remains unchanged from the previous trading day. Purchasing interest among converters is weak, and yet total PP and PE inventories at major local producers’ warehouses fell another 20,000 to 540,000 tons as of 28 December 2017. Such low inventory level clearly reflects the lack of pressure and as a result, sellers might maintain firm stance on offers in the coming week. At the moment, traders are offering CNY50-100/ton ($8-15/ton) reduction due to weak futures trading.
Polyethylene (PE)
It is reported that a major Thailand producer has sold 5000 tons of LDPE film to China this week at $1185-1190/ton, a $15-20/tom reduction week on week. “We also procure 15 containers of Singaporean LLDPE C4 film at $1200/ton CFR China, LC AS term today after obtained $20/ton discount. This price level is relatively competitive as it is duty free cargoes,” a trader informed. The source expected more LLDPE C4 film from Singapore to come in the near term with the producer’s new PE unit in Texas, USA come into operation, which would fulfil local demand in that market.
Domestic market remains sloppy with spot offers fall CNY50-100/ton ($8-15/ton) from previous trading session. Players are entering holiday mood. There are very few new offers available as sellers have mostly achieved target for the year and would only resume trading in the coming week.
SOUTHEAST ASIA
Polypropylene (PP)
There are still deal done for import homo-PP from dutiable origins to Vietnam reported at $1180/ton CIF, LC AS term, though the rate is much thinner. “We are still having quantity on hand. Regular buyers are not aggressive at the current market level though it is less likely that our principal supplier would concede to additional discount,” a distributor informed.
Domestic PP market in Indonesia witness a small reduction of $10/ton week on week in distribution market due to arrival of import cargoes. Cash term cargoes reach $1225/ton FD Indonesia today. Indonesian buyers are not active even with the discount with a source complaining, “Our end product demand remains weak and therefore we prefer to wait and see.”
Polyethylene (PE)
Better number of deals for import HDPE film are reported in Vietnam in the range $1270-1290/ton for various origins, including Thailand, Saudi Arabia and Kuwait. These prices are about $10/ton below initial offers levels. Local traders are not attracted to the high prices, which reflect the real demand from converters in the country. “However, our customers are only interested in making small purchases. We are confident that market shall remain on the current track into 2018,” an international trader informed.
In contrast, the regional LLDPE film market is performing much weaker in term of both price and purchasing interest. Import LLDPE film on an average is traded at more than $100/ton lower than HDPE film at the moment. Vietnamese traders are blaming the ample supply of off-grade LLDPE film at competitive prices in local ground for the lacklustre buying interest of prime grade cargoes. In fact, some converters are able to mix up to 70% of off-grade South Korean LLDPE film in their products in order to cut costs.