China’s import PE prices resume uptrend on ongoing cost support
Government policies and higher PE prices across domestic markets in the country have also contributed to the current trend.
Cost-side support remains fundamental
ChemOrbis Price Wizard shows that crude oil prices hit ten-month highs following the news regarding OPEC’s projection of tighter supply for the year-end. Stronger energy values have also underpinned the continuing uptrend in upstream markets. Data also suggest that spot ethylene prices on CFR China basis have gained around 17% since mid-June to stand at $840/ton, the highest levels in the past four months, at the time of press.
A trader commented, “The continuous support from crude oil is keeping PE spot prices at elevated levels this week. On the demand side, an increase in the production rate of agricultural film companies is anticipated. The peak season for greenhouse film is approaching and large-scale companies are expected to see some improvement in their prospects. There is a more noticeable increase in production rates. However, orders for agricultural films from companies are still weaker compared to the same period in previous years.
As for supply, he added, “Supply is reduced primarily due to the anticipation of improved downstream demand. Additionally, there have been several unplanned plant shutdowns recently, leading to a slight reduction in supply.”
According to market sources, the two major producers’ combined polyolefin levels were standing at 660,000 tons as of September 13, down by 30,000 tons from early week.
ME origin prices up further by $10-20
Middle East origin prices are now at $980-1040/ton for LDPE film, $970-1010/ton for HDPE film, and $940-980/ton for LLDPE film, all on CIF China, cash basis. The ranges are up by $10/ton for LDPE film, $20/ton for HDPE film and flat to $10/ton for LLDPE film when compared to last week.
Meanwhile, the weekly averages of Middle East origin prices are now standing at their highest levels since March-April, ChemOrbis data also suggest.
Availability issues continue for LDPE
Since early September, LDPE supply has been reported tighter compared to other grades. A converter said, “Supply is sufficient for LLDPE, but short for HDPE and LDPE. We heard that there are problems with the delivery of Iranian cargoes. Producers have faced high costs and no inventory pressure, so they have remained firm on their offers.”
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