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China import PE markets stay bearish on tightened measures, falling yuan

by Pınar Polat - ppolat@chemorbis.com
  • 12/05/2022 (02:43)
In China, the downward spiral in the import PE markets has continued this week as demand conditions have remained weak. The country has tightened Covid-19 curbs in some major hubs including Shanghai and the capital Beijing recently, resulting in disruptions in logistics and manpower amid restrictions on the movement of people and materials.

Adding to the scenario was the yuan’s depreciation against the USD. According to media sources, the currency has lost over 4.5% to the USD since the beginning of April.

The last time such a rapid depreciation was experienced was in 2015. This has also hindered demand for import cargoes further, keeping buyers’ eyes on the local markets when it comes to urgent needs.

A trader said, “Import PE prices are dropping further this week due to sluggish demand and weaker Dalian futures values in the early week amid lower energy values. Shanghai tightens lockdown which has been in place for the past six weeks while there are mass testings in the capital Beijing. Demand is limited especially for import cargoes, as the yuan is depreciating against the USD. China’s April exports
were the slowest in the past two years, adding further pressure on China’s economy and raising concerns among players.”

CIF China PE prices fall back to January lows

ChemOrbis Price Wizard shows that the weekly averages of LDPE, HDPE, and LLDPE film prices on CIF China basis have been losing ground since early April, moving back to the lowest levels since mid to late January.

PE – Import – China

LDPE film falls below $1500 CIF mark, $20-50 losses for HD, LLDPE film

The overall range for import LDPE prices has fallen $30-60/ton from last week so far to stand at $1450-1480/ton CIF China, cash recently.

As for HDPE and LLDPE film, the overall ranges have decreased $20-50/ton from last week so far to stand at $1150-1190/ton and $1140-1300/ton CIF China, cash basis, respectively.
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