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CHINA

• Surging local homo-PP market pulls sentiment in import ground
• Import PE market stabilized

Polypropylene (PP)

Domestic homo-PP yarn hit above the CNY10,000/ton mark for the first time since CommoPlast started tracking local index in 2016, reaching CNY10,050/ton ($1265/ton without VAT), EXW China, cash equivalent, up approximate CNY700/ton ($102/ton) since the beginning of June. 

Trading activities in the import market improved visibly, sources said, with deals for Saudi cargoes reported at $1230-1240/ton CFR China. “There is a greater acceptance this week. Unfortunately, we only have 300 tons of cargoes. Market is regaining the momentum and we think other markets in Asia would soon follow,” an international trader commented.

Polyethylene (PE)

Major Thailand maker reportedly sold out LLDPE film to China at $20-40/ton discount from initial price list at $1200-1220/ton CFR China term. Demand is satisfactory, sources said, despite the steep depreciation of the Chines Yuan against the US dollar, buyers continue looking for cargoes at competitive levels.

In the meantime, Chinese buyers started complaining about the significant drop in the number of new offers received for import LDPE film this week. Market has accepted Saudi LDPE film at $1160/ton CFR China – the level that faces stiff resistance just a week ago. According to an international trader, “This is a very positive signal. Buyers from the agricultural film sector are returning to make purchases, which might support the near-term market prospect.” 

SOUTHEAST ASIA 

• Import PP emerged at higher levels, deals showed minor w.o.w changes 
• Regional PE market remains calm 

Polypropylene (PP)

Overseas sellers firmly lifted import offers for homo-PP yarn by $10-20/ton compared to last week, sending latest prices to $1260-1280/ton CIF Vietnam, LC AS term and deals emerge in the range $1230-1250/ton with the same term. Although sellers are unable to achieve the price hike target at the first attempt, market does see better acceptance rate among customers.

Such development sends a clear signal that the market is back on track for a stable to firmer trend. The only question is the sustainability of the current trend since fear of escalated trade war continues to linger in the market.

Polyethylene (PE)

Offers for import PE, especially LLDPE film, remain very limited. Major Saudi Arabia allocated an additional 200 tons each for HDPE film and HDPE blow moulding to Vietnam at $1300/ton and $1290/ton, CIF, respectively. “Due to the limitation in quantity, we sold out the cargoes in 10 minutes without any price negotiation. It is still unclear to determine the market direction at the moment but we do hope to see better demand in the coming weeks,” a distributor informed.