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China PE markets stay bearish with import prices below new thresholds

by Pınar Polat - ppolat@chemorbis.com
  • 09/11/2022 (09:32)
In China, the bearish sentiment has permeated the PE markets for another week due to lackluster demand, with import prices hitting more-than-two-year lows. Apart from the government’s adherence to Covid Zero stance, the end of the agricultural season, the yuan’s depreciation as well as strengthening economic headwinds have kept buying activity limited.

Adding to the scenario has been increasing availability from overseas markets, with sellers mostly adopting a more aggressive stance when it comes to getting a chance of concluding deals.

ChemOrbis Price Index suggests that import PE prices in China have been on a downhill since early April, if a short-lived upturn in the second half of September is disregarded. The weekly averages of CIF LDPE HDPE, and LLDPE film prices are now standing at their lowest levels from July to August 2020.

Import – PE –Asia

CIF LDPE film prices break below $1000 mark

LDPE film has continued to fall at a faster pace than HDPE and LLDPE film. Traders reported Middle East origin LDPE film offers at $980-1000/ton CIF, cash this week. Offers for Indian origins stood at $970/ton with the same terms. ChemOrbis data also suggest that the weekly averages of the Middle East and Indian origin prices have lost around 36% since the downtrend kicked off in early Q2.

“Import PE availability has been increasing recently. Overseas producers are aggressive and willing to give discounts to conclude deals. However, the number of deals done is still rare with downstream markets entering the off-season and the impact of the pandemic restrictions. Buyers are only interested in dealing at a lower price range as their inventory level is low,” a trader commented.

Low ends of CIF HDPE, LLDPE film ranges formed by US offers

Like LDPE film, HDPE and LLDPE film prices on CIF China basis also tested new threshold this week and offers below $900/ton are reported this week.

Import HDPE film and LLDPE film prices have fallen within the range of $30-40/ton from last week so far to be assessed at $860-910/ton and $870-940/ton CIF China, cash, respectively. The low ends of both grades are formed by US-origin offers. Compared to Middle East origin offers, US origin HDPE and LLDPE film prices are $30-50/ton and $20-30/ton lower, respectively.
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