Higher costs, firmer regional trends push PE prices higher in SEA

Players in Southeast Asia report that PE prices moved higher over the past week in accordance with stronger regional trends and higher upstream costs. Prices are expected to remain firm in the coming week, with increases likely to be more pronounced near the lower end of the ranges as disappointing demand from the nearby Chinese market will prevent prices at the upper ends from posting any significant hikes.

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In the import market, prices have posted significant increases on the low ends of the ranges for both HDPE and LLDPE film. A Vietnamese trader based in Hung Yen stated, “We lifted our import offers this week in accordance with higher prices from our suppliers. We think that prices will remain mostly stable after the most recent price hikes.”

A source at an Indonesian producer reported, “We issued two separate increases over the course of the week as stronger regional trends and healthier domestic demand encouraged us to raise our prices.”    An Indonesian converter manufacturing plastic bags and sheets stated, “Demand has improved but not enough to justify any pre-buying under the current conditions.” Another Indonesian converter active in the packaging sector commented, “Demand for our end products is picking up these days.”

A Thai distributor based in Bangkok reported, “Domestic PE prices have firmed up this week and we believe that local prices will remain steady at these new levels. Demand has picked up somewhat as buyers have started to return to the market to replenish their stocks.” Another Thai distributor added, “Domestic prices have increased this week and relatively limited supply will help keep prices firm. However, buyers are offering some resistance to the most recent increases and demand has not been as strong following the most recent hikes.”

A plastic bag manufacturer in the Philippines stated, “Local PE prices firmed up a bit this week. We are not looking to purchase any material for now as we had sourced enough material to meet our needs last week and prefer to focus on our end product business for now.” Another Philippine converter added, “Locally-held PE prices are moving higher this week in accordance with improved demand, although PE prices are not rising quite as quickly as PP prices.”