Local PP, LDPE prices more competitive than imports in China

In China, local PP and LDPE prices have been softening since late February, which has caused the local markets to go below import markets, according to weekly average prices obtained from ChemOrbis Price Index.

Falling futures prices and ample supplies have been weighing down on the local PP market. Local PP buyers in China, therefore, have been showing no interest in import materials due to more competitive local offers. As can be seen from the graph below, average local PP prices have moved below the import market since late February.



Source: ChemOrbis Price Wizard

The PE market has remained under pressure from high stocks and retreating futures prices as well. Particularly for LDPE, both local and import prices have been falling since the end of the holidays in early February due to stagnant demand.

ChemOrbis Price Wizard shows that local LDPE prices also moved below import LDPE prices on average as of late-February. The average of the current import LDPE film prices is trading $25/ton above local prices in China.



Source: ChemOrbis Price Wizard

A Chinese trader commented, “We are not planning to buy any import materials for now as local prices are more competitive and our inventory level is high. Moreover, the market is still slow to digest the current levels.That’s why, we are re-exporting PP and PE in order to deplete our stocks faster and obtain better margins.”