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CHINA

• Import LLDPE film falls sharply toward the weekend
• Active exporting PP cargoes cast little help on reducing domestic inventories

Polypropylene (PP)

Total PP and PE inventories at domestic major producers’ warehouses fell 20,000 tons to approximate 940,000 tons as of 16 March 2018. While it appears that local market has finally speeded up the inventories digestion rate, players fear that the number would breach above the 1 million tons threshold by the beginning of next week. “We are still offering up to CNY100/ton ($15/ton) discount for serious buyers. Local cargoes are competitive at the moment and we think this condition might persist in the coming weeks,” a trader said.

There are market talks that Chinese suppliers managed to export a considerable quantity [rumour at 50,000 tons] of locally produced homo-PP over the past month, however, the exact figure would only be available once the Customs Department release the latest data. 

Polyethylene (PE)

Import LLDPE film fell sharply on the final trading day of the week. Compared to the first week of February 2018, the average import LLDPE film based on CFR China, LC 0-90 days term has fallen nearly $65/ton, CommoPlast data showed. A major Saudi Arabia maker slashes LLDPE film prices by $50-60/ton compared to last month, bringing latest price list to $1160/ton CFR China, LC AS term. “We proceed with purchases immediately without any negotiation. We think this price level is very competitive for regular Saudi cargoes,” a trader commented.

In the same time frame, local HDPE film fell about $90/ton on an average, underlining stronger pressure on import ground in the near term.

SOUTHEAST ASIA

• Import homo-PP and HDPE film fall on persistent weak demand
• Sentiment shattered with strong expectation for further price cuts

Polypropylene (PP)

Purchasing interest across the region remains sloppy on the final trading day of the week and several deals for import homo-PP observed at $10-20/ton lower than the previous day. Saudi Arabia cargoes concluded in Vietnam at $1260/ton for injection and $1280/ton for yarn grade, all based on CIF, LC AS term. “A number of lower costs cargoes purchased previously has just arrived and we are in no rush for fresh replenishment at the moment. The market is correcting and we might look into new buy when prices go below $1250/ton threshold,” a buyer said.

A similar situation is reported in Indonesia, though it appears that domestic traders here are firmer on the cargoes after conceding to sharp price reductions throughout the week. “Our regular supplier is no longer interested in negotiating, in which we decided to purchase a small quantity of homo-PP yarn at $1260/ton FD Indonesia, cash term. However, this price level is still enough to pressure import offers,” a buyer said.

Polyethylene (PE)

Import HDPE film offers to Vietnam go down visibly and absurdly in spite of the stronger upstream ethylene costs. There are only Thailand cargoes holding at $1410-1430/ton CIF Vietnam, LC AS term while most deep-seas parcels dropped to the range $1365-1395/ton with the same term. “Market is entering a price correction period, however, we think this trend is not getting too far given the rising monomers costs and tightening supply on the heavy maintenance shutdown season. The demand shall return very soon,” an international producer commented.