Gap between LLDPE and HDPE hits a multi-year high in SE Asia
ChemOrbis data shows that the premium import LLDPE film prices carry above HDPE film is currently at around $60/ton. The gap hit almost a five year high, reaching $76/ton at the beginning of August.
According to a few players in the region, Exxon Singapore is producing mostly metallocene LLDPE which is keeping supplies of LLDPE c4 limited. A converter reported that he heard the producer will make only metallocene grade starting in 2017.
Players also made similar comments for Thailand’s PTT which is currently producing metallocene grade. A trader noted, “The producer will produce another round of metallocene in the second half of October using its existing plant.”
A trader operating in Indonesia complained about weak buying appetite, commenting, “We are feeling sales pressure nowadays, particularly for HDPE film which sees very poor demand.”
A Vietnamese seller stated, “LLDPE supplies are limited and therefore demand is slightly better for this product. On the other hand, buyers think that HDPE offers are still too high to be accepted. Hence, they are adopting a wait and see attitude for the present time.”
A Malaysian trader added, “Buyers are limiting their purchases according to their immediate needs nowadays as they expect to see additional decreases in the short term. However, we think that the near term outlook is a bit uncertain for now. Petronas is planning to shut its HDPE line for maintenance on August 21 for five days.”
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