Bearish sentiment spills over to Middle Eastern PP, PE markets in November
Saudi PP, PE markets weaken after 2 months firming
In Saudi Arabia, local polyolefin producers announced rollovers to slight decreases for November, based on a global weakness in PP and PE markets, as well as disappointing demand among domestic market players. A Saudi major’snew offers came with mostly rollovers from October. Meanwhile, offers from another local producer were announced with rollovers to SAR75/ton ($20/ton) decreases when compared to October levels.
Emirati producer cut local offers by $30/ton
Middle Eastern producers also announced lower offers in the United Arab Emirates as compared to initial October levels. Generally, import PE prices have started to decline for the first time since August. A major Saudi producer’s new offers were largely lower by $50/ton as compared to initial October levels while they are mostly steady when compared to the latest October deals.
Also, the country’s local producer, Borouge, addressed the market with $30/ton decreases compared to October offers. Meanwhile, local sellers noted that the producer offered an additional $60/ton reductions. Generally, players are struggling to maintain their margins in the midst of stumbling demand and weak market fundamentals.
Activities subdued amid regional conflict in East Med
In the East Mediterranean region, import PP, PE prices for November also surfaced with rollovers to decreases when compared to the latest October levels. The Gaza conflict has threatened the economy in the region, causing further recession across the markets.
In Lebanon, November PP and PE offers were reported with $30-40/ton decreases when compared to the latest October deals while they recorded more than $50/ton reductions when compared to initial October levels. “The country is currently struggling with growing political instability as well as sharp currency devaluations. These factors have led to unhealthy economic conditions and hindered the purchasing activity further,” a distributor opined.
Meanwhile, new November PP and PE offers were announced in Jordan mostly with rollover from latest October levels. Players expect the bearish sentiment to persist as sellers are already open to discounts for firm bids.
Waning demand sets a bear outlook until the end of 2023
Players across the region expect the bear run to remain in place until the end of the year, citing rising political concerns amidst the current conflict and their direct impact on the trading activity. Also, dwindling crude oil futures, lack of supply concerns and the bearish sentiment in other global markets all reinforce a bearish outlook.
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