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Chinese players reported receiving the first HDPE injection cargoes from the newly start-up Braskem Idesa plant in Mexico this week at relatively competitive price level. Indeed, prime grades HDPE injection parcels were offered at $1020/ton CFR China, LC AS term.

A converter received the offer commented, “We plan to buy a small quantity for testing first before committing to any real purchase. Demand for our end product is weakening while we are still having inventories on hand.”

Braskem Idesa completed the construction work early this year and commenced trial run in March 2016. At the moment, it is estimated that the company’s ethane cracker is running at 80% capacity; three HDPE lines with total capacity of 750,000 tons/year and a LDPE plant with 300,000 tons/year capacity are all in operation. The plant initially aims to reduce Mexico’s dependence on import cargoes.

Players are now showing concern about the supply-demand balance outlook in the coming days as buying interest is weaning amidst traditional low season for home appliances and agriculture film sectors in China.