Asia Daily PP and PE Overview 2 October 2018

There are no trading activities in China this week due to the National Day holiday. Market will resume working on 8 October 2018.

SOUTHEAST ASIA 

• More overseas sellers lift import homo-PP offers to SEA market 
• Regional HDPE market continue facing pressure 

Polypropylene (PP)

Following the price hike from a major Thailand producer on the first trading day of the week, more regional and overseas makers are implementing similar pricing strategy. In fact, Vietnamese homo-PP emerged in Indonesia at $10-20/ton higher week on week. The supplier claimed to have no sales pressure at the moment after achieving excellent sales result in China market. “We sold additional 5000 tons of Vietnamese homo-PP cargoes to China last Saturday and therefore, we have very little remaining allocation for October,” the trader informed.

In Vietnam, a Saudi Arabia maker is collecting bids for yarn grades and while there have not been any final prices, the supplier plan to keep deals at $1250-1260/ton to reflect the strong upstream costs and reduced sales pressure after the good sales in China last week. 

Polyethylene (PE)

The import HDPE market in Southeast Asia continue to face downward pressure and the downturn in ethylene prices is adding more pressure on the already sluggish market. Thailand HDPE film is available in Vietnam at the price $1260/ton and buyers are placing bids at $20/ton lower. “We are waiting for the supplier to confirm, however, there is a high chance that we could obtain the proposed discount,” a buyer said.

Meanwhile, a major Indonesian maker lifted local prices for the second time this week following the sharp depreciation of the local currency. Further hike is inevitable given the fact that the local currency might weaken further against the US dollar in the near term. However, buyers are not aggressive in making fresh buy claiming comfortable inventories levels. "Only small to medium scale converters would continue sourcing homo-PP cargoes, but only purchase in small quantity. We are not confident that local suppliers can achieve the hike target on LLDPE film given the heavy influx in import materials," a trader said.