Asia Daily PP and PE Overview 26 September 2018

CHINA

• Local market started to calm down 
• Import PE mostly emerged at higher levels 

Polypropylene (PP)

Trading activities in local ground started to slow down after days of aggressive replenishment. A number of converters reported to have stocked up comfortable inventories until the second half of October and might gradually withdraw to the sideline in the coming days. 

“We are done replenishing for now. There might be some reduction in the post-holiday term given the heavy influx of nearby Asian cargoes while most shutdown plants in the local market would have restarted by then. We started letting the employees go off for the holiday,” a PP storage box maker said. 

Polyethylene (PE)

New import offers from various overseas producers including Qatar, Thailand, Taiwan, and India mostly see $10/ton increased week on week. In the meantime, there is very limited immediately deals observed. Sources fear that the US dollar might strengthen against other currencies in line with the almost ascertained interest rate hike, which makes imports more expensive.

Details on each price list are available on CommoPlast official website.     

SOUTHEAST ASIA 

• Indonesian buyers started responding to the firming trend in China market
• More Saudi maker announced new PP, PE offers 

Polypropylene (PP)

It appears that Indonesian buyers started checking on import offers following more than a week of aggressive buying activities in the nearby China market. Deals for Saudi homo-PP yarn are reported at $1240/ton CIF Indonesia, LC AS term with a supplier said, “There are only 300 tons available this time. Buyers are not very active yet, however, there is at least some movement.”

In the meantime, local distributor introduced IDR400,000/ton ($27/ton) hike from last week to IDR19,800,000/ton without VAT ($1327/ton) FD Indonesia, cash equivalent. “Up-stream costs are high. Overseas availability might drop in the near term now that most suppliers managed to achieve good deals in China. We started seeing some support here,” a source said. 

Polyethylene (PE)

Another major Saudi Arabia producer announced October shipment offers for PE to Southeast Asia market with $50/ton reduction on HDPE film and $20/ton on LLDPE film. Latest offers stand at $1280/ton for HDPE film and $1120-1130/ton for LLDPE film. “New offers are relatively competitive and we hope to obtain some minor discounts before concluding some quantity,” a Vietnamese buyer informed.  

Meanwhile, a couple of other producers, who announced new prices earlier this week have not finalized prices. Players are watching out for final deals, which would become a reference point in placing new bids for the later cargoes.