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CHINA

• Local ground remains active due to pre-holiday replenishment
• Healthy deals in import offers have not pushed prices higher 

Polypropylene (PP)

Total inventories at Sinopec and CNPC’s warehouses drop as much as 40,000 tons from the previous trading day to approximately 670,000 tons as on 19 September 2018 all thanks to the healthy trading activities condition in the local ground. Sources expected the pre-holiday replenishment to persist throughout the first half of the coming week, however, remain cautious about the post-holiday replenishment.

More deals for competitive Vietnamese homo-PP are observed in the range $1250-1260/ton CFR China, LC AS. “Other Southeast Asian suppliers started to come too, including Philippines homo-PP at $1260/ton. If domestic offers continue to rise at the current pace, more customers will turn to import market for duty-free cargoes,” a trader said. 

Polyethylene (PE)

Taiwanese producer is not the only one enjoying healthy sales result following the price cuts. In fact, Thailand maker reportedly sold out allocation for HDPE film at $1330-1335/ton and LDPE film at $1135/ton, all based on CFR China, LC AS. 

The latest tariffs round in the trade war saga between China and the USA show little impact on the sentiment given the fact that players have already well anticipated the outcome. “There is no surprise here. Converters are looking for ways to mitigate the impact on the end product demand. At the moment, all focus is on meeting local needs for the Sing Day sales,” a market source added.     

SOUTHEAST ASIA

• Market await October shipment offers, little impact from pre-holiday replenishment in China 
• Import HDPE film to Vietnam is lower than to China 

Polypropylene (PP)

The active trading activities in China have not given sufficient support to the Southeast Asia market. Instead, buyers here fear that this development might not long lasting and that market outlook in the post-holiday term remains cloudy. 

Malaysian maker announced October shipment offers for homo-PP to Indonesia at $10/ton reduction from the previous month to $1300/ton CIF, LC AS. Buyers are demanding for larger discounts citing the improved availability from the new plants. “We do hope to obtain some discounts on PP cargoes as well, now that new cargoes from Vietnam are available at the relatively competitive level,” a buyer added. 

Polyethylene (PE)

Import HDPE film to Vietnam continues to slide as major Saudi Arabia producer agree to deal at $1260/ton CIF Vietnam, LC AS term while most other Middle Eastern makers are collecting bids at the range $1270-1280/ton with the same term. Data from CommoPlast showed that the average import HDPE film to Vietnam is currently about $25/ton lower than that in China, prompting expectation that either one of the markets shall have correction to bring the gap back to order.

More maker would announce new prices in the coming week and the general expectation is that PE prices must see some downward adjustments.