Asia Daily PP and PE Overview – 11 December 2018

CHINA

•        Domestic PP market faces steep reductions
•        Good transactions for PE cargoes with stable prices 

Polypropylene (PP)

Domestic spot homo-PP offers plunged CNY200-250/ton ($29-36/ton) day on day, signaling the persistently sluggish condition in the local ground. Traders have been complaining about the disappointed sales result this week while only hope to see a pause in the sliding trend soon.

“With such condition in the local market, we are curious to see how sustainable is the rebound trend in the import ground. We are adopting a more cautious stance for now,” a trader said.  

Polyethylene (PE)

At the beginning of the week, a major Qatari producer decided to maintain offers unchanged from last week on the background of higher price list from other supplier. At the time this report is published, the Qatari maker has sold out the available allocation given its competitiveness.

Meanwhile, customers are putting serious consideration on Thailand PE cargoes, which see $20/ton increased from last week to $1160/ton for HDPE film and $1130/ton for LLDPE film, CFR China, LC AS term. “The offers are too high. It is difficult to compete with other origins,” a distributor said.

SOUTHEAST ASIA

•        Import offers and buying interest move in the opposite direction 
•        Concerns on sustainability of the current firming trend build up significantly 

Polypropylene (PP)

A major Thailand producer set final prices for regular homo-PP yarn at $1120/ton CIF Vietnam, LC AS term. All bids below this level have been shrugged off as the supplier claiming limited availability and stronger upstream costs.

Local traders in the region are leveraging the development in the import ground to stabilize domestic prices but refrain from making replenishment considering the yo-yo condition in the nearby China market.

Polyethylene (PE)

Entering further into the week, the Southeast Asian market is rather mixed. While some suppliers are lifting prices regardless of the plunge in the upstream ethylene costs, others are maintaining offers stable to softer for post-Lunar New Year arrival. 

“We received HDPE film offers from two separate Middle Eastern suppliers and the differential is $50/ton. We are in doubt if overseas sellers can really lift offers without any major support,” a regional buyer reported.