Import PE tightness eases off in China; LDPE stabilizes at two-and-a-half-year high
“The high demand season stretching from September to October is over. Supplies are increasing, and additionally spot ethylene prices are moving lower. A combination of these factors are weighing on PE sentiment,” they noted.
A few other factors putting players in a cautious mood were cited as a fresh wave of COVID-19 cases in overseas countries, volatile crude oil futures and the US elections.
HDPE, LLDPE slightly down; LDPE stable on week
Data from ChemOrbis Price Index reveal that the weekly average of import LDPE prices for overall origins has stabilized at $1195/ton CIF, the highest level since May 2018. Suppliers are preserving their LDPE offers at high levels as this product is still relatively stronger than other PE grades.
The weekly averages of HDPE and LLDPE film prices on CIF China, cash basis have seen weekly decreases of around $5-10/ton to be quoted at $965/ton and $940/ton, respectively.
This has been the second consecutive week that they track a softer trend.
Price relief mostly attributed to improving supply levels
One of the main reasons pushing import PE prices higher was the tight availability particularly for LDPE. Amid Iranian shipments issue and US force majeures, prices saw consecutive increases for weeks.
According to traders, all Iranian cargoes have already been discharged successfully at Chinese ports, which helped import supply levels improve in the country.
As for supply disruptions from the US amid the hurricane-driven force majeures, players reported that US producers were gradually going back to normality. According to some market sources, recovering supply levels have already weighed down on export LLDPE and HDPE offers from the country.
Spot ethylene down 16% on month
Meanwhile, two South Korean producers who reduced their LLDPE and HDPE film offers to China by $10/ton from last week pointed out that lower feedstock costs also hurt buying appetite.
According to ChemOrbis Price Wizard data, spot ethylene prices on CFR China basis have declined 16% or $135/ton from a month earlier to be recently quoted at $735/ton, the lowest level since around mid-August.
More free plastics newsPlastic resin (PP, LDPE, LLDPE ,HDPE, PVC, GPS; HIPS, PET, ABS) prices, polymer market trends, and more...
- PVC sellers’ India pricing strategy may differ from other Asian markets
- More US PE offers find way to China, SE Asia; yet allocations still limited
- European PVC market hits 2-year high on tightness
- Supply constraints send key ABS markets to new highs
- Tightness leads to renewed PP hikes in China; Saudi raffia moves above $1000 CIF
- Asian PVC players brace for 7th straight monthly hike in Taiwanese major’s delayed Dec offers
- Saudi major seeks hikes for November in global PE, PP markets
- Bullish sentiment for PE cools off across globe, LD remains resilient
- Bullish run for PVC enters 6th month in Turkey: Supply relief under question
- Overseas PP producers’ focus shifts to SE Asia as Chinese demand fades