Morning Briefing - 17 October 2022
CommoPlast
Morning Briefing
17 October 2022
Brent: $91.63 (- $2.94）
WTI: $85.61 (- $3.50)
Naphtha CFR Japan: $671 (+ $2)
Ethylene CFR NEA: $850 (Stable)
Ethylene CFR SEA: $880 (- $20)
Propylene FOB Korea: $870 (Stable)
Propylene CFR China: $900 (- $5)
*Data represent closing prices of the previous trading day
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A week after Chinese market participants returned from the Golden Week, we get asked a lot about how the post-holiday demand condition in this market is. Here is a summary of what has been going on over the past week for your reference:
1. Domestic market dropped on a daily basis (except for the first two days) despite the relentless depreciation of the Yuan against the US dollar. The currency exchange rate issues also hampered overseas sellers’ efforts to maintain a firm stance on new offers.
2. Trading sentiment fell to a near standstill after the government reiterated the unwavering stance toward the Zero-Covid policies with no plans to fully re-open the country in the near-term, all to save lives.
3. Inter-city delivery becomes a huge issue, and many warehouses have shut down for sanitization
4. Export-oriented manufacturers have been juggling between Zero-Covid compliance and reduced overseas orders for several months. According to governmental data, export orders for luggage, electric blanket, and winter apparel from EU customers remain strong, but other products have seen sharp declines.
5. While the LLDPE film market has been supported by the improving demand from the agricultural film sector over the past several weeks, market sources fear that the trend is not sustainable.
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