Chinese traders focus on re-exporting PP, PE to S East Asia
A trader based in Beijing reported that they are giving re-export offers for European LDPE to Southeast Asia as the market level is higher when compared to China.
A Vietnamese trader also affirmed the wide existence of re-exported cargoes from China at more competitive levels than the imports from the Middle East, saying that this situation has also pushed a local producer to lower its PP offers.
A global trader in Vietnam also commented, “Our Taiwanese supplier revised its PP offers down this week given softer propylene costs. However, they are still not as low as re-export offers from Chinese sellers. This has also influenced our sales. We are sidelined for now in order to monitor the market.”
As reported earlier this week in a ChemOrbis Daily Headline , the PP market in Southeast Asia has already moved back above China by more than $100/ton, although this premium was previously at and below $50/ton.
In the case of LDPE, Southeast Asia’s import market regained its premium back above China in the latter part of February. After having traded below China with a discount of up to $100/ton in the last quarter of 2016, Southeast Asia’s import LDPE market has recently climbed back over China by $100/ton.
These growing price gaps also clearly explain the Chinese traders’ appetite to divert their stocks to Southeast Asia.
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