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CHINA

·      Local market loses momentum 

·      Limited trading activities in the import ground

Polypropylene (PP)

Apparently, the firming trend in the local ground is cooling off following the plunge in the futures market. Inventories at major local producers’ warehouses have dipped below the psychological mark, yet local suppliers are not confident enough to maintain firm stance on the spot offers. Instead, a discount of CNY50-100/ton ($7-14/ton) immediately emerges as the futures trading weaken.

The near term market outlook is a rather cloudy, sources said, citing the new startup that adds more supply to the market. Together with the escalating trade tension between China and the USA, demand is expected to remain mediocre.  

Polyethylene (PE)

A major Thailand producer agreed to $5/ton discount on LLDPE film to close deals at $1010/ton CFR China, LC AS term. There have been reports that buyers off-take few thousand tons of these cargoes considering the duty-free benefits.

Meanwhile, market is not showing great interest in other cargoes fearing that resumed falling local ground might force overseas sellers to concede to further price cuts.  

SOUTHEAST ASIA 

·      Middle Eastern LLDPE film touches the $1000/ton mark 

·      Riot poses minimal effect on Indonesia PP, PE market 

Polypropylene (PP)

The regional PP market remains mostly unchanged from the previous trading day. However, suppliers continue facing difficulties in attracting deals as customers remain on the sideline to wait for more discounts.

It appears that the recent riot in Indonesia has not impacted trading activities in the country significantly. Sources commented that demand is diminishing as buyers embrace the holiday mood while manufacturers are rushing for final delivery before the road ban takes place. 

“Business is as usual. Purchasing activities have been declining ahead of the long holiday; therefore, we do not see any major impact from the riot. We hope demand would pick up in the post holiday term,” a trader said.  

Polyethylene (PE)

A Middle Eastern supplier has agreed to concluded deals for PE to Vietnam at $1000/ton for LLDPE film and $1060/ton for LDPE film, all based on CIF, LC AS term. Buyers fear that import LLDPE film prices might soon breach below the $1000/ton mark given the sluggish sentiment and the recent downtrend in the nearby China market.

“Meanwhile, we expect demand to pick up in Q3 as year-end order kicks in. As a result, we do not have any plan to slash prices too steeply. We would announce June shipment offer in the coming week,” a Saudi Arabia producer opined. 

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China  Indonesia  Malaysia  Vietnam