Local PE prices remain bearish, nearing multi-year lows across SE Asia

Local LDPE prices in Southeast Asia have hit the lowest in two and a half to three years in the face of falling demand and ample stocks, while LLDPE and HDPE markets have largely faced relatively limited losses.

Traders say supplies have stayed largely adequate in the domestic markets, especially for LDPE, while HDPE and LLDPE availabilities have relatively been somewhat tighter. Demand has stayed weak for all PE grades given lower domestic requirements of finished products.

Malaysian producer cuts June offers

In Malaysia, a producer reduced its June PE offers when compared to May except for HDPE grades that saw rollovers. The producer reduced June offers by MYR80/ton ($17ton) for LDPE grades from last month while HDPE grades remained stable.

Assessments for Malaysian local prices in the previous week saw LDPE film prices trading at the lowest in almost three years. As for HDPE, Malaysian local prices hit a two-year low in November last year but has since maintained a stable to firm stance. Assessed prices last week were about 4% higher than the two-year-low levels hit in November 2022.

Indonesian market sees HD, LL at 2½-year lows

In Indonesia, both HDPE film and LLDPE film are currently at two-and-a-half-year lows, ChemOrbis Price Index data show.

An Indonesian producer early in the week cut PE offers by up to 2% in its latest weekly pricing notifications sent to local buyers. HDPE prices saw a marginal fall of IDR20,000/ton ($1/ton), while LLDPE offers slid by IDR180,000/ton ($13/ton).

Vietnamese LD film close to three-year low

The LD film price in Vietnam was close to a three-year low, at the assessed range last week of VND27,500,000-28,000,000/ton ($1066-1085/ton without VAT) FD Vietnam, cash inc VAT.

As for LL film, the price hit a two-year low in November 2022, but has since seen an increase by about 6%. “But there hasn’t been a lot going for the grade in the Vietnamese market lately and prices remain under pressure,” a Vietnamese trader said. The LLDPE film prices were assessed in the previous week at VND26,500,000-27,500,000/ton ($1027-1066/ton without VAT) FD Vietnam, cash inc VAT.

The HD film price also hit two-year lows in November last year but has since risen by about 11% to trade in the previous week at VND27,000,000-28,500,000/ton ($1046-1105/ton without VAT) FD Vietnam, cash inc VAT.

Thai prices also struggle to look up

The ChemOrbis Price Index data also show LDPE domestic prices falling to near-three-year lows at THB39500-40500/ton ($1146-1175/ton) FD Thailand, cash not including VAT.
As for HDPE, prices were assessed at two-year lows in November last year but has since seen a firming of the market, which is currently at THB40250-40750/ton ($1167-1182/ton) FD, cash not including VAT.

LLDPE traded at a two-year low in December last year but has since firmed up slightly to be assessed in the previous week at THB38500-39750/ton ($1124-1153/ton) FD Thailand, cash not including VAT.

Traders said months of persistently sluggish demand have dragged down prices in most regional domestic PE markets, although LDPE has been affected the most, with supplies of LLDPE, and especially HDPE, staying somewhat tighter.

“Demand has stayed lower for a long time. More recently, the expectation of the US Federal Reserve hiking interest rates in June for the 11th time has further depressed the market,” a converter said. "Additionally, ethylene prices have also been falling. Meanwhile, converters/buyers have been sitting on mounting inventories, and do not need to replace stocks,” he added.