Asia Daily PP and PE Overview 10 September 2018

CHINA

• Local suppliers look forward to pre-holiday replenishment 
• Import HDPE film continue facing pressure 

Polypropylene (PP)

Domestic inventories at Sinopec and CNPC warehouses rose 70,000 tons over the weekend to approximately 810,000 tons as of 10 September 2018. Despite strong trade threat from the USA, local spot market remains resilient with spot offers for both PP and PE up CNY50-100/ton ($8-16/ton) from last week.

“Sales are acceptable at the lower end of the overall price range. These two weeks are critical. Buyer shall make larger replenishment before going off for the mid-Autumn Festival and the National Day holidays,” a trader commented.

Polyethylene (PE)

In the import market, deep-sea HDPE film cargoes priced above the $1300/ton are facing stiff resistance in spite of the fact that supply has not improved significantly. Saudi cargoes are concluded in the previous week at $1260/ton CFR China, LC AS term, which continue encouraging buyers to demand for the same level entering this week.

“It is very difficult to attract deal for HDPE film at the moment, yet, due to the lack of inventories pressure, we did not match the customers’ buy ideas,” a Saudi maker offers HDPE film at $1300/ton and LLDPE film at $1110-1120/ton CFR China, LC AS term said. 

SOUTHEAST ASIA 

• Light trading activities due to holidays
• Buying interest for import cargoes drop due to uncertainty in the near-term outlook 

Polypropylene (PP)

Trading activities across Southeast Asia region are light on the first trading day of the week as buyers in Malaysia and Indonesia are embracing the Muharram holidays. Most overseas sellers have not opened fresh offers, though a major Thailand maker is collecting bids for homo-PP yarn in Vietnam at the moment. 

“Most buyers expressed the buy idea at $1250-1260/ton CIF Vietnam, LC AS term. We have not decided on the final prices,” a source close to the producer said.

Buyers are on the other hand, are not planning to make large purchases at the moment as the currency issues in major markets such as Indonesia, India and Turkey might turn market into the bearish zone in the final quarter of the year.

Polyethylene (PE)

Offers for Kuwait HDPE film inch slightly lower to $1280-1290/ton CIF Vietnam on the first trading day of the week and yet, buyers are rather cautious about fresh replenishment. “Export orders are strong. We are operating at the full rate now, however, we just fear that with unfavourable international trade condition, prices might go down further in the near term,” a HDPE bag maker export mainly to European market said.  

Supplier for Thailand HDPE film is currently collecting bids at $1280-1290/ton CIF Vietnam, which market finds very attractive given the short lead-time. Lunar New Year comes earlier than usual this time, from which many buyers, especially local traders become reluctant to accept too long lead-time cargoes.