Shandong Yulong Auction: Slight Improvement in Activity but Demand Still Muted

Shandong Yulong’s 27 November auction recorded a mild increase in deal activity from earlier this week, though volumes remained limited, reflecting buyers’ continued preference for needs-based procurement.

Activity improved slightly in LLDPE film, supported by increased allocations from the producer. Several traders interpreted the higher volume offering as Yulong’s attempt to meet internal month-end sales targets. However, despite the broader availability of LLDPE film, buyers continued to prioritise discounted spot cargoes circulating in the domestic market.

“It ultimately hinges on price competitiveness,” a trader told CommoPlast. “Most converters remain cautious and only step in when local distribution offers show meaningful discounts. Yulong’s auction parcels have yet to reach that threshold.”

HDPE grades showed little traction, with HDPE film and HDPE yarn seeing no deals. Limited engagement in HDPE blow grades further highlighted the muted sentiment, as converters maintained strict purchasing discipline amid soft downstream demand.

Multiple market participants noted that no PP grades were offered in today’s auction. A local distributor said the producer reportedly oversold its PP allocations through offline channels. “We heard that PP was fully committed outside the auction, but we haven’t observed any exceptionally competitive PP offers in circulation,” the source said. “That adds to the sense that overall conditions remain challenging.”

While today’s auction reflected marginally firmer engagement, the broader takeaway remains unchanged: downstream demand is still weak, and buyers are operating on a strictly needs-based basis. Without stronger discounts or improved downstream performance, auction activity is expected to remain restrained in the short term.

Written by: Kat Yun Yun

Edited by: Farid Muzaffar