Asia Daily PP and PE Overview – 4 December 2018

CHINA

•        Import PP market remains firm as local rebound
•        Overseas sellers reported good sales results for HDPE cargoes 

Polypropylene (PP)

Moving towards mid of the week, import offers for homo-PP below the $1000/ton threshold continue to disappear from the market, replacing by cargoes at the $1020/ton levels and above. 

Sentiment in the import market might continue gaining support as local ground strengthening day by day. “Inventories digestion rate is high, releasing sellers from the high pressure. This is a good sign for the market,” a trader added.

Polyethylene (PE)

The number of deals for import HDPE film and yarn is rather healthy in this market. Major Thailand maker reportedly sold more than 3000 tons of HDPE cargoes in the price range $1120-1140/ton CFR China, LC AS term hours after the new price announcement. Couple of other Middle Eastern suppliers also reported better movement for this grade.

Even the import LDPE film market seems stabilizing with a major Saudi maker sold out allocation to China in the price range $960-990/ton CFR term. 

SOUTHEAST ASIA 

•          Regional buyers become more active but cautious on deals
•        Import PP market halts downtrend; strong rebound seems less likely

Polypropylene (PP)

Southeast Asian buyers tend to be more active in checking on new offers and development in the import homo-PP market following the rebound in China. However, real transactions remain below expectation, as customers also tend to be selective on the cargoes.

Apparently, the effort to lift prices quickly failed to attract sufficient attention and couple of suppliers have already stepped back on the initial price list slightly. “But the trend is that the market temporarily might not drop below the current low,” an international trader sold Saudi homo-PP injection at $1055/ton CIF Vietnam, said.    

Polyethylene (PE)

Regional players are intrigued by the fact that the price gap between LLDPE and HDPE film is narrowing down in a rather quick pace in Asia. A number of buyers have expressed the intention to make new replenishment gradually if suppliers agreed to prices in the range $1050-1070/ton for regular Saudi cargoes.

“The positive effect of the trade talk is fading. We need to be cautious,” an Indonesian source said while adding that local HDPE market is racing lower after trading at a high level for most of the year.