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SOUTHEAST ASIA 

• More suppliers concede to discount on PP as upstream pressure mount up
• December PE offers might slide despite tight availability for MEA origin 

Polypropylene (PP)

The upstream propylene costs continue to fall, adding more pressure to the downstream PP market. Following the price cuts from major Middle Eastern supplier to Vietnam in the previous trading day, more suppliers start taking a similar step.

In fact, duty-free Vietnamese homo-PP yarn achieves deals at $1200/ton in Indonesia, and yet many buyers here are hoping to see an additional price cut in the near term. “We plan to wait for prices below the $1200/ton threshold. Demand for our end product is stable, however, the profit margin is rather thin. In the meantime, we still have comfortable inventories,” a woven bag converter added.  

Polyethylene (PE)

Deals for USA LLDPE film have reached $1000/ton CIF Vietnam for end of February arrival. Market is moving lower regardless of the recovery on the upstream ethylene costs. Data from CommoPlast showed that ethylene based on CFR Southeast Asia term surged $50/ton this week compared to late last week on the back of improved replenishment activities in the nearby China market.

Couple of overseas suppliers has expressed the sell ideas for December shipment offers mostly at a lower level from last month. “We don’t have too much of inventories pressure, especially for HDPE film, therefore, we will try to keep prices near to the $1200/ton mark this time,” an international trader carries PE cargoes on behalf of a Saudi maker commented.