Morning Briefing - 13 December 2022
CommoPlast
Morning Briefing
13 December 2022
Brent: $77.99 (+ $1.89)
WTI: $73.17 (+ $2.15)
Naphtha CFR Japan: $620 (- $3)
Ethylene CFR NEA: $890 (Stable)
Ethylene CFR SEA: $920 (Stable)
Propylene FOB Korea: $855 (Stable)
Propylene CFR China: $890 (Stable)
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The domestic PP and PE market in China extended the firming trend after the government scrapped the use of travel tracking apps and Shanghai declared the end of the pandemic.
Spot homo-PP rose CNY100-150/ton ($14-21/ton) while LLDPE film jumped CNY50-100/ton ($7-14/ton) from last Friday.
Purchasing activities, however, slowed down visibly on the first trading day of the week as market participants prefer to monitor the highly fluid market condition before making additional replenishment. Offers at the higher end of the overall price range faced stiff resistance, signalling the possibility that the recent upswing might be close to its peak.
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In Southeast Asia, new offers are limited on the first trading day of the week ahead of January price announcements. Expectations are that overseas sellers might attempt to implement at least $20-30/ton hikes on the new price list to reflect the reduced inventory pressure and brighter market outlook as China reopens from COVID-19 lockdowns.
In local Indonesia, a major local producer aggressively increased PP offers, introducing two rounds of price hikes since Saturday, but buyers are not ready to accept. Woven bag makers complained that the current raw materials costs are higher than their finished goods selling prices, therefore, these buyers decided to withdraw to the sidelines for now.
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