Ebbing demand keeps July PE price hikes in check in Türkiye

Import PE prices extended their gains into the second straight month, with regular sellers seeking higher July prices, citing the lingering logistic mishaps worldwide and unfavorable netbacks in Türkiye. Yet, subsiding resin demand cushioned larger hike targets since the challenging economy and unsupportive end-user orders kept purchases hand to mouth.

High-end offers see resistance even for LDPE

As July started, producers revealed their fresh PE offers with increases. This was not caught by surprise, considering the lack of a healthy premium of Türkiye over Asian outlets and elevated ocean container prices. Yet, larger increases were pushed back by converters even for LDPE, the tightest product in terms of supply. A seller admitted, “Demand was better in June despite the religious holidays.”

Middle Eastern LDPE film offers were assessed $20/ton higher on the week at $1210-1240/ton CIF Türkiye, subject to 6.5% customs duty, cash. Offers for certain MFI grades stood at $1250/ton CIF whereas they met buyers’ mounting resistance.

“Last week’s prices around $1200/ton CIF faded. Yet, some buyers hesitated to accept any prices above this threshold as they preferred to wait for their previously secured cargos. Limited end-product orders played a role in this stance,” players said.



Gap between LDPE and HDPE/LLDPE widens

As for LLDPE C4 film and HDPE film, Middle Eastern offers were assessed unchanged at $1070-1090/ton and stable at $1050-1070/ton, respectively, following modest gains in the previous week.

Sellers affirmed, “LLDPE demand has been muted while HDPE grades remained under a heavier strain given abundant availability and poor activity in several markets across the board. We concluded deals with slight discounts but still achieved some monthly gains.”

In the meantime, the premium of LDPE over other commodity grades continued to climb to reach around $150/ton this week, as per the weekly average data from ChemOrbis. A converter said, “As we do not expect a major uptick in activity by August, LLDPE and HDPE prices may stabilize. This would also exert some pressure on LDPE at some point, and prices may see some modest corrections.”

No major impact from Hurricane Beryl on sentiment

In the meantime, Hurricane Beryl led to a series of precautionary shutdowns at petrochemical plants in Texas, US, earlier this week. Nonetheless, the impact was limited on resin sentiment as the restart process kicked off for several companies and Beryl slowed shortly after.

A global seller noted, “We may see 2 to 3 weeks of delivery delays from US suppliers. Apart from that, we do not foresee a considerable effect on supply in the coming term. American cargos may continue to arrive faster than Middle Eastern volumes.”

Still, pressure from netbacks puts a floor under prices

Import PE prices still provide poor netbacks for global sellers based on offers in China and Southeast Asia, although they have improved to a certain extent. Thereby, the market may move sideways in the short term, with Turkish players sticking to the sidelines after wrapping up their monthly businesses.

Now that import prices have been on a stable to softer trend in these Asian markets since early July, players will keep a close eye on the upcoming trajectory to have a better clue about the August outlook in Türkiye. “If Asia remains weak, the uptrend may come to a halt in Türkiye next month,” opined some players.