Asia Daily PP and PE Overview – 17 December 2018

CHINA

•       Local market regains stabilization following stronger futures trading 
•       Import PP, PE sees limited movement, though softer stance on PP is observed

Polypropylene (PP)

Thanks to the recovery in the futures market, local traders move to lift spot prices by CNY50-100/ton ($7-16/ton) from late last week. The sentiment is improving, however, customers remain cautious about large buys, fearing that market might turn soft again.

In the import ground, most suppliers maintain price list unchanged week on week, except there are several deals for Indian homo-PP cargoes below the $1050/ton threshold. Besides, Vietnamese materials appear at $20/ton lower than last week, at $1120/ton CFR China, LC AS term.

Polyethylene (PE)

Couple of Middle Eastern producers announced January shipment offers to China in the range $1010-1030/ton for LLDPE film and $1050-1070/ton for HDPE film. 

“We are slowing down the replenishment of deep-sea cargoes, especially those arriving after the Lunar New Year. The market outlook is not very clear and we prefer to take cautious stance,” a buyer commented.  

SOUTHEAST ASIA 

•       January PE offers emerge with reductions from last month 
•       Limited movement in the PP market as both buyers and sellers are on the wait and see 

Polypropylene (PP)

Very few suppliers have opened new offers for homo-PP to Southeast Asia on the first trading day of the week; however, it appears that sellers are adopting a firmer stance on the prices compared to the previous week. In fact, Middle Eastern cargoes priced below the $1080/ton mark are not available at the time is report is published.

“We are seeing better local demand in India and this is lending us some support for the export market,” an Indian producer said while adding that their 600,000 tons/year PP plant in Hazira has resumed operation after a brief unexpected shutdown last week.

Polyethylene (PE)

A major Saudi Arabia producer announced new PE offers for January shipment to Vietnam and Indonesia with $60-80/ton reduction from last month for HDPE film, sending the latest price list to $1070-1080/ton CIF, LC AS. Offers for LLDPE film from the maker only drop $10/ton to $1030-1050/ton with the same term. 

Buyers are asking for $30-40/ton reduction on deals. In the meantime, other producers might announce new offers within this week to avoid clashes with the Christmas holiday next week. Similar cuts are expected.