Shandong Yulong Auction: Participant rates in LLDPE auction improved, but market caution prevailed

Shandong Yulong concluded its morning auction session on Thursday, 24 July 2025 with mixed results, underscoring a persistent selective buying sentiment despite a backdrop of bullish developments in China’s domestic polyolefins market.

According to trade data, import PE volumes into China fell by 10.2% month-on-month in June, with the sharpest declines seen in shipments from the USA and Iran. This contraction in supply, alongside ongoing government-mandated inspections targeting refinery and petrochemical assets aged over 20 years, has fuelled concerns about potential disruptions. While no official policy directives have been announced, the mere prospect of shutdowns has provided upward momentum to the domestic spot market.

Even so, the auction results revealed a price-sensitive buyer base, particularly for PP grades. Deal volumes for homo-PP yarn and injection remained limited, with most lots either partially sold or fully rejected. Offers were broadly seen as uncompetitive under current market dynamics.

In contrast, LLDPE film saw significantly stronger interest. The 3,300-ton FD lot for LLDPE film was oversubscribed, indicating renewed demand optimism for select PE grades. Total LLDPE deals reached 5,316 tons across all terms—marking a notable improvement compared to previous sessions.

“This gives us a glimmer of hope that demand is returning,” one participant commented. “However, we are still monitoring the situation and remain cautious about committing to larger volumes.”

While auctions like Yulong’s reflect pockets of buyer activity, overall sentiment remains anchored in a wait-and-see mode. Traders and buyers alike are navigating a fragile recovery clouded by both macroeconomic uncertainties and weak end-product demand.

Written: Kat Yun Yun

Edited: Rochelle Nguyen