LDPE draws a weaker picture in China
The weakness in LDPE is attributed to several factors. First, players point out high stock levels for this product in the midst of unsatisfactory demand. “Sellers have had to lower their LDPE film offers which were already found to be too high before the Chinese New Year holiday. Demand for LDPE is the weakest among PE products,” commented a trader.
A distributor also commented, “LDPE prices had peaked in the pre-holiday period and now they are facing some correction as local inventories have increased and converters still need time to run their plants at normal rates. Plus, they do not seem to be in a rush for stock building since they prefer to run down their inventories.”
On top of rising inventories in the local market, an influx of import cargoes is expected in line with the arrival of previously secured cargoes. This expectation has also weighed down on the sentiment.
According to ChemOrbis Price Index, import LDPE prices have lost around $20/ton this week when compared to the pre-holiday levels on average while LLDPE and HDPE film prices are firmer in the same timeframe.
In the local market, meanwhile, average LDPE prices have posted a decrease of more than $20/ton on the week while the cumulative decrease is around $90/ton when compared to the pre-holiday levels. On the other hand, LLDPE and HDPE prices are stable from the pre-holiday levels on average, based on ChemOrbis Price Index.
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