Morning Briefing - 14 March 2022
CommoPlast
Morning Briefing
14 March 2022
Brent: $112.67 (+ $3.34）
WTI: $109.33 (+ $3.31）
Naphtha CFR Japan: $1019.6 (- $44.0)
Ethylene CFR NEA: $1350 (- $10)
Ethylene CFR SEA: $1350 (- $10)
Propylene FOB Korea: $1305 (Stable)
Propylene CFR China: $1265 (Stable)
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The local China PP and PE market have been dwindling since last Thursday, partly due to the plunge in the energy complex. Also, the worsening COVID-19 outbreak in China sparks fears that the government might implement strict lockdown measures to break the infection chains, hence, curtailing demand.
As of 14 March 2022, China has lockdown Shenzhen. Dalian Commodity Exchange opens with more than CNY300/ton reductions.
Trading activities in the domestic spot market is expected to weaken throughout the first half of the day.
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A key Taiwanese producer might postpone the new PVC announcement for April offers to the week of 20 March amid the heavy fluctuating market. However, market sources expected an increase of between $80-100/ton considering the strong upstream costs.
Sources said that looking at the ethylene market, the producer could implement larger increases, however, the overall supply condition remain comfortable in the presence of Chinese materials and soft demand from Indian buyers ahead of the financial year closing in March.
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The Asian naphtha market has plunged more than $145/ton over the final two trading days last week, yet the current prices are still too high for the regional naphtha cracking operators. An increasing number of producers across the region are planning to cut operating rates to protect the bottom lines, including Malaysia’s Lotte Chemical Titan and Thailand’s SCG.
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