African PP, PE markets soften into June

Africa’s major regional polyolefin markets are heading into June on a softer note, with the initial import offers in Kenya and Nigeria indicating a continued weakness in pricing and demand. These new offers were largely in correspondence with expectations voiced in May, during which a year-long uptrend snapped amid rising supplies and sluggish buying sentiment.

Drops extended into 2nd month in Kenya

In Kenya, the largest economy in East Africa, new PPH inj. and raffia offers from a Saudi supplier were at $1450/ton CFR Kenya, 90 days. These levels were lower by around $250/ton from the previously available Saudi levels and also lower by $30-50/ton compared to their Asian counterparts in May.

According to ChemOrbis Price Index, import PPH raffia and inj. offers in Kenya have declined by $300/ton on average, or more than 17%, since early May. Import HDPE film and LLDPE C4 film prices have also declined by 7-12% during the same period.

The latest PE offers for June were $120-130/ton lower from May levels at $1380/ton for HDPE film and LLDPE C4, and $1400-1430/ton for HDPE b/m, with the same terms. A trader based in Nairobi reported slow activities with most buyers at the sidelines, waiting to hear more offers before engaging in fresh purchases. “Other suppliers are expected to announce lower offers for June, so these expectations are keeping the buyers at bay,” the trader added.

Saudi major cuts offers sharply in Nigeria

In Nigeria, the biggest polymer market in West Africa, a major Saudi supplier cut PPH raffia and inj. offers sharply by $300/ton from May, bringing them down to $1480/ton PPH raffia and inj. CFR Lagos, excluding 10% customs duty. According to ChemOrbis Price Index, the weekly averages of import PPH inj. and raffia prices are hovering near their lowest since March this year.

The major producer’s June PE offers indicated drops ranging between $125/ton and $280/ton over the previously available levels in May. The latest levels were reported at $1370/ton for LLDPE C4 film and HDPE film, and $1700/ton for LDPE film, with the same terms.

“June offers declined as expected,” a trader based in Lagos said, pointing to the bearish global trend. The trader reported that the availability for nearly all grades was comfortable and shipping was of no issue and added: “Buyers are very cautious as they think further cuts are on the horizon.”

Import PPH raffia and inj. offers in Nigeria have declined by $415/ton on average, or more than 21%, since early May, according to ChemOrbis Price Index. Import HDPE film, LDPE film and LLDPE C4 film prices have also seen decreases ranging between 10% and 17% since early May.