Asia Daily PP and PE Overview 15 November 2018

CHINA

• Import homo-PP continue to slip 
• Strengthening ethylene costs have yet to support PE market 

Polypropylene (PP)

In a much anticipated development, traders managed to sell Indian homo-PP cargoes at $1150/ton CFR China LC 0-90 days term for both yarn and injection grade. However, it is important to note that purchasing activities are not as strong as expected given the fact that buyers are rather conservative about the near-term outlook.

In the domestic spot market, suppliers continue cutting offers for homo-PP cargoes regardless of the rebound in futures trading. “Local market is too high. We have some inventories on hand and prefer to take a wait and see stance for now,” a buyer added. 

Polyethylene (PE)

In the import ground, mainstream Saudi Arabia HDPE film concluded deals at $1160/ton CFR China, LC AS term after much reluctant from the supplier to cut offers from the $1200/ton levels. Ethylene costs rebounded slightly this week as replenishment activities started to kick in, and yet PE market has not escaped from the increasing pressure condition. 

SOUTHEAST ASIA 

• Saudi homo-PP slipped below $1200/ton threshold in Vietnam 
• Supply outcast the impact of firmer ethylene costs 

Polypropylene (PP)

Deals for import homo-PP originated from Saudi Arabia materialized in Vietnam at the price range $1180-1190/ton CIF, LC AS term for the first time this year. It appears that buyers are not very eager to make replenishment this time citing a possibility of further reduction in the coming weeks.

“Propylene costs are going down too sharply. The pressure is really strong and we prefer to wait first,” a converter commented. 

Polyethylene (PE)

Ethylene market seems to regain some strength this week that gives the regional player some confidence about the market outlook. However, most remain very cautious about the market condition considering the heavy influx of deep-sea cargoes from the USA. 

In Vietnam, prime grade LLDPE film originated from the USA concluded deals at the range $1000-1010/ton CIF, LC AS that quietly sends a chillwave to the market just a day after Thailand HDPE film reached deals at $1160/ton level.