Can LDPE uptrend hold in Asia?
Local PE prices in China have remained stable or posted weekly decreases of up to CNY200/ton ($30/ton) so far this week in response to the oil-driven losses in LLDPE futures. January LLDPE futures on the Dalian Commodity Exchange were settled CNY170/ton ($25/ton) lower on Tuesday, September 22.
A China-based trader said, “Due to weakness in the domestic market, import offers are decreasing this week although overseas sellers do not have much sales pressure. Demand is limited as buyers remain on the sidelines. HDPE is still the weakest PE product but we have received re-exported LDPE from Vietnam at $1130/ton CIF.”
At those levels, LDPE prices are down 2.6% from $1160/ton CIF China last week. Import LDPE prices hit a two-year high last week - according to the weekly average data obtained from ChemOrbis Price Index.

Re-export cargoes from Vietnam are putting added pressure on the LDPE market in China, even as demand in the world’s second biggest economy starts to taper ahead of the national holidays in early October.
Some restocking activity ahead of the holidays may provide some support ahead of the National Day Holiday, which runs across October 1-8.
Supply remains tight
The uptrend in LDPE prices has been due to tight supply globally amid few new capacity additions and plant shutdowns. Another factor has been increased demand for food packaging due to social controls amid the pandemic.
A source at a Middle Eastern producer said, “This month’s allocation is not much and almost all sold to China where prices are better than Southeast Asia. Buyers in Southeast Asia are reluctant to buy at high levels. But supply should continue to be limited as not many new plants will start up this year because of weak demand.”
Meanwhile, PTT’s scheduled maintenance shutdown from late September of its 300,000 tons/year LDPE plant at Map Ta Phut in Thailand for 24 days is expected to keep supply tight.
Spillover impact from China expected in Southeast Asia
LDPE prices have also been holding up in Southeast Asia amid tight supply and initial offers for October have started to be announced with notable increases. However, spillover impact from China in terms of the business lull during the lengthy national holidays starting late next week is expected to impact the region due to the strong trade links.
Additionally, pressure may also come from LDPE cargoes diverted from China amid the business lull there during holidays, which should increase supply in Southeast Asia.
LDPE prices were standing at $1090/ton CIF SEA during the week that ended on September 18. This marks their highest level since April 2019, according to ChemOrbis data.
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