Morning Briefing - 07 Jan. 2025
CommoPlast
Morning Briefing
07 January 2025
Brent: $76.30 (- $0.21)
WTI: $73.56 (- $0.40)
Naphtha CFR Japan: - $11
Ethylene CFR NEA: Stable
Ethylene CFR SEA: Stable
Propylene FOB Korea: Stable
Propylene CFR China: Stable
*Data represent closing prices of the previous trading day
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The Chinese PP and PE markets commenced the week under significant downward pressure, driven by a sharp decline in key futures contracts on the Dalian Commodity Exchange. The bearish sentiment was exacerbated by mounting concerns over the rising domestic supply and the potential for heightened tensions in the US-China trade dispute, leading to cautious buying behaviour.
However, market dynamics were not entirely bleak. Some major manufacturers resumed procurement activities, raising cautious optimism among suppliers about a possible rebound in demand. This anticipated improvement is largely tied to pre-Lunar New Year stockpiling trends. Nevertheless, the scale and sustainability of any recovery remain uncertain, given the underlying macroeconomic and geopolitical risks that continue to weigh on market sentiment.
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In India, reports of increased purchasing activity for LDPE emerged at the start of the week, primarily driven by restocking efforts in anticipation of constrained local availability. The anticipated supply tightness is linked to scheduled maintenance at a domestic production facility, which has temporarily bolstered market sentiment.
Despite this uptick in buying interest, price acceptance remains lacklustre. Market participants highlight that tradable LDPE film from the Middle East is around $1100/ton CIF India, positioning the Indian market as one of the lowest-priced regions in Asia.
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