Local PP, PE markets turn up in China

Players reported that China’s local PP and PE markets posted increases this week after following a stable to softer trend in the post-National Day holiday period except for HDPE in the midst of limited supplies. The recent increases were attributed to firmer futures markets, the ongoing maintenance shutdowns as well as some replenishment activities.

LLDPE and PP futures on the Dalian Commodity Exchange respectively witnessed total increases of CNY255/ton ($39/ton) and CNY371/ton ($56/ton) in October 16-17.

“Local PP and PE prices increased given higher futures prices. Demand is normal,” a few traders noted.

Another trader commented, “We think the futures market will be volatile after the 19th National Congress of the Communist Party of China. This factor may push both PP and PE prices higher. Local producers, CNPC and Sinopec’s local inventories are reported at/above 700,000 tons, which is considered as a normal level. We are yet to see strong demand after the holiday; however, there were some replenishment activities albeit in small amounts. Environmental inspections are still going on and maintenance shutdowns also support the market.”

In China, prices for local homo-PP raffia have increased by CNY300/ton ($45/ton) so far this week while PE offers are up by CNY350/ton ($53/ton) LDPE film, CNY400/ton ($60/ton) for LLDPE film and by CNY250/ton ($38/ton) for HDPE film.