Coronavirus raises concerns over post-holiday demand in Asia’s polymer markets
Holiday extended on rising death toll
The Chinese government announced on Monday that it has extended the ongoing Lunar New Year holiday by three days until February 2 in an effort to contain the spread of the deadly coronavirus. The pandemic virus has caused more than 130 deaths in China since it first started in Wuhan two weeks ago.
In line with the government’s decision, trading on the Dalian Commodity Exchange (DCE) and the Shanghai Stock Exchange has been suspended until February 3.
Virus-hit trade weighs on PP, PE outlook
China’s demand for PP and PE is likely to remain subdued in February as rising concerns over the virus outbreak have dampened the market sentiment.
“Buyers may adopt a wait and see stance once they return to their desks next week in anticipation of seeing price decreases amid a slowing economy. Moreover, overall domestic PP and PE stocks may pile up due to the extension of the holiday, exerting downward pressure on the market over the near term,” commented a few players.
“The PE market entered the holiday on a firm trend due to reduced supplies from the Middle East, however, we are not sure if prices can extend their gains into the post-holiday period,” a PE seller also noted.
PVC majors may delay March announcements
Asian PVC markets were hovering around a four-month high ahead of the holiday on the back of tighter supplies. Despite the virus-hit sentiment, players believe that Asian producers might maintain their firm stance over the near term pointing to their limited availability.
However, according to some, major PVC producers may delay the announcement of their March prices by around one week due to the extended holiday.
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