Asia Daily PP PE Report 27 Apr 2016

In China, futures prices on Dalian Commodity Exchange precede the week with mix sentiment as contract number 1609 for PP settled CNY31/t ($5/t) higher compared to yesterday at CNY7122/t ($938/t without VAT). Contract for LLDPE futures meanwhile slashed CNY130/t ($20/t) on weaker demand at CNY8775/t ($1156/t without VAT).

Futures trade loses firming momentum has put a break on the increasing trend in spot domestic market. Local PP and PE price list was announced today at mostly unchanged level compared to the previous trading session and distributors become more open to negotiation with serious buyers. However, many reported seeing visible slow down in buying interest with a source from Foshan said, “This is a knee-jerk reaction every time futures market slow down. We only managed to conclude a small number of deals today and even our regular customers are expecting further reduction in the coming week.”

Many players are still attending ChinaPlast event and sellers are directing their focus on selling in local market from which little changes in the import offers are observed today. Players mostly expect to see more movement after the Labour Day holidays when buyers are back to their desk, but not much optimism are seen. A number of domestic PP and PE plants shutdown in April would resume production soon and might pressure the market further    

In Southeast Asia, market sentiment remains quiet and deals are rather limited amid concerned buyers regarding the near term prospect. A major Thailand producer adjusted their HDPE offers to Vietnam down by $10/t compared to initial offer given yesterday to reach $1230/t CIF due to strong buyer resistance. A producer source said, “Even after the downward adjustment, we see little buying interest. Domestic market is very weak now and we might need to hold these cargoes throughout this week.”

Buyer confidence is diminishing along weaker ethylene costs, and expectation that restarted crackers after maintenance shutdown would bring monomers supply back to normal in the coming month is pushing buyers to the side-line. A trader active in selling to European market said, “We are not expecting any significant drop in PE prices in Asia at least for the near term given relatively tight supply. Demand in Europe is better than here and the arbitrage opportunity is still open for sellers.”

Trading activities in the PP market is apparently slower and buyers are shy away from making fresh purchases after seeing more aggressive stance from suppliers. Many buyers contacted by CommoPlast reportedly stand on the side-line waiting to see clearer direction after the Labour Day before making further decision. An Indonesian buyers added, “Local trader have dropped their homo-PP offer again today but we are planning to replenish some cargoes from import market instead. Our buy idea for Vietnamese homo-PP is at $1100/t CIF Indonesia, and we are waiting for our supplier’s respond. Our end product business is regular but might turn slower in the near term.”  

For detail Daily Prices in China and Southeast Asia market, kindly visit our website atwww.commoplast.com. Please contact our representatives at commoplastinfo@gmail.com for log in assistance.