Asia Daily PP and PE Overview 01 August 2018

SOUTHEAST ASIA

• Import LLDPE film market mixed, expectation remains positive
• Local PP suppliers in Indonesia race to cut price despite tighter local supply

Polypropylene (PP)

Indonesia domestic homo-PP market has been operating differently and contrasts with import ground. While it is clear that overseas sellers are putting tremendous effort to stabilise the homo-PP yarn market after weeks of continuous reduction, signalling that prices might have reached the bottom; major local suppliers in Indonesia race to slash offers. 

Deals for September delivery parcels are observed at IDR18,500,000-18,700,000/ton ($1282-1295/ton) without VAT, FD Indonesia, cash term for quantity 500-1000 tons. Such movement is deemed not necessary considering the shutdown at Polytama and Pertamina that tighten domestic availability to a certain extent. Overseas players are speculating that this is an act of protecting market share among domestic suppliers. 

Polyethylene (PE)

The import LLDPE film in Southeast Asia is rather confusing amid diverged pricing policies by major suppliers. While Thailand LLDPE film sees $20/ton reduction from initial price list to $1120/ton CIF Vietnam, LC AS term, a major Saudi Arabia market introduced $10/ton hike. 

“Market is struggling to find a direction. But we feel the cyclical bottom has been reached and demand shall pick up by the second half of the month,” a regional buyer said. The source citing that import HDPE film is under stronger pressure and very likely to continue moving towards the mid-$1200/ton levels.