Asia Daily PP PE Report 10 Mar 2016

In China, futures prices on Dalian Commodity Exchange recorded some losses for LLDPE contract while PP futures continue to move north. Contract number 1605 for PP settled at CNY25/t ($4/t) higher at CNY7191/t ($943/t without VAT) and LLDP futures plunged CNY180/t ($28/t) to reach CNY9060/t ($1188/t without VAT).

Domestic spot offers for both PP and PE added CNY100 ($15/t) from yesterday levels, however, sentiment appear to loose momentum toward the end of the trading day as traders are disappointed with futures trading. 

A trader in Yuyao commented, “The volatile futures market has psychologically impacted the market these days as buyer loses confidence to make fresh purchases. We are not receiving many calls from customers today and the number of deal we could conclude is rather disappointed. We feel that the market needs a break before it could move up further. At the meantime, we do not see any factors that could pull prices down as supply is limited.” Another trader sold Omani homo-PP at $940/t BWH China, TT basis also complain about weaker buying interest said, “Our customers refused to pick up phone call in the second half of the trading session, and we know this is not a good sign.”

A converter in Fujian added, “We have replenished sufficient PP cargoes before Chinese New Year and currently digesting our inventory. Demand for our end product has yet to improve, therefore we are not in rush to make replenishment.”

In Southeast Asia PE market, tight supply and firming upstream costs are cultivating a stronger foundation for further price hike. In fact, sellers are indicating intention to lift their offers in the next opening. A major Middle East producer informed, “We sold very well to China and India market in the past months, hence our allocation for Southeast Asia market is rather small. There is an increasing competition in the LDPE market with the emergence of a new Middle East maker, however, we think that the market would continue to move higher in the coming days.” A flexible packaging converter in Malaysia added, “Supplier is lifting their prices on a weekly basis, especially when supply from Thailand is so tight. Demand for our end product is regular, however, we prefer to buy hand-to-mouth basis considering volatile crude oil values.” Local PE prices in Vietnam continue to move up, yet many traders elected to increase their offers gradually to avoid buyer resistance.

In the PP market, players in Indonesia continue to report shortage in supply for homo-PP injection and PP film with a major local maker increased offers for homo-PP injection and thermoforming by approximate $20/t compared to last week. A converter commented, “Demand for our end product is not bad yet we prefer to purchase on need basis. Local supply is really tight and suppliers are adjusting their offers very often. We believed that this trend might roll into the month of Apr as we see the supply condition might not improve anytime so soon.” There is minimal import offers observed in the market as sellers claim lack of cargoes available.

For detail Daily Prices in China and Southeast Asia market, kindly visit our website at www.commoplast.com. Please contact our representatives at commoplastinfo@gmail.com for log in assistance.