Morning Briefing - 18 Feb. 2025

CommoPlast

Morning Briefing

18 February 2025

Brent: $75.22 (+ $0.48)

WTI: Holiday

Naphtha CFR Japan: (- $5)

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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Softer Chinese PVC Offers

In Malaysia, market participants have reported receiving lower import offers for Chinese ethylene-based PVC compared to earlier this month, just ahead of major regional suppliers' announcements for March shipment offers. The latest price adjustments, down by $10-20/ton from previous levels, have failed to stimulate significant buying interest as concerns over currency fluctuations and a potential demand slowdown during the Ramadan season weigh on sentiment.

Chinese suppliers attempted to firm up spot prices in both domestic and export markets in the previous week, bolstered by reports of the government’s $6.8 billion funding initiative to support property developer Vanke. However, mounting inventory pressure poses a challenge. Data from CommoPlast indicates that PVC stockpiles at key warehouses in Eastern and Southern China have surged to levels last seen in late November 2024, underscoring persistent supply-side concerns.

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Sudden Hike in Local HDPE film Offers

In a move that disrupted market expectations, a leading Indonesian producer hiked domestic HDPE film offers up by IDR 660,000/ton since the previous week, seeming to ignore ongoing weakness in downstream sectors. Market participants referred to regional supply shortages as one of several possible drivers of the increase, citing shutdowns at various Southeast Asian facilities.

Nonetheless, buyers pushed back strongly against the hike, citing prolonged difficulties in raising end-product prices. With bids sitting stubbornly IDR 2.29 million/ton below the producer’s latest offer, negotiations over this grade may remain cutthroat in the days ahead.

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