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Morning Briefing - 10 October 2024The Chinese polyolefin market faced a setback on the second trading day of the week, with prices for select grades of PP, PE, and PET declining from the previous day. This downturn stemmed largely from growing buyer resistance to recent price hikes |
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CommoPlast
Morning Briefing
10 October 2024
Brent: $76.58 (- $0.60)
WTI: $73.24 (- $0.33)
Naphtha CFR Japan: - $13
Ethylene CFR NEA: Stable
Ethylene CFR SEA: Stable
Propylene FOB Korea: + $5
Propylene CFR China: + $5
*Data represent closing prices of the previous trading day
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The Chinese polyolefin market faced a setback on the second trading day of the week, with prices for select grades of PP, PE, and PET declining from the previous day. This downturn stemmed largely from growing buyer resistance to recent price hikes, which were implemented in anticipation of economic stimulus measures that have yet to materialize from the Chinese government.
The price drops were observed across all major trading platforms in China, including the Dalian Commodity Exchange, the Shenhua Auction Platform, and the spot market. Industry sources speculate that the market may recover if the government introduces additional economic support in the coming days. However, without concrete intervention, the current resistance signals deeper uncertainty about the strength of market fundamentals and the sustainability of price movements.
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While other resin markets have experienced declines, the Chinese LDPE sector has continued to rise, with spot prices increasing by an additional CNY 100–300/ton. This surge stems from concerns over potential supply disruptions from a major supplier - Iran. Despite the escalating prices, demand has remained robust, as buyers, constrained by low pre-holiday inventories, brace for the agricultural season.
Notably, LDPE film prices have now reached their highest levels since July 2022, and further increases are anticipated in the short term, driven by persistent supply risks and heightened seasonal demand.
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