Mid-East polyolefin market sentiment turns bearish in September

In the Middle East, polyolefin markets have mostly snapped a two-month uptrend in September. The bearish pressure from weakening global markets, falling costs and dwindling downstream demand have outweighed supply hiccups and shipping disruptions across the bloc. Although Saudi PE markets bucked the overall trend with slight price hikes hitting 16–17-month highs, they are expected to correct down in the second half of the month.

Saudi PP hit their lowest levels since Feb, PE hikes swirl for third month

In Saudi Arabia, new September PE offers from a major domestic producer indicated SAR75/ton ($20/ton) increases from August. According to data from ChemOrbis Price Wizard, current HDPE prices are at their highest level since April 2023, while LDPE and LLDPE prices saw their highest levels since May 2023. They are, however, expected to adjust lower in the second half of the month given frail demand.

Meanwhile, the major’s PP offers extended their losses into the second straight month with SAR82-100/ton ($22-26/ton) decreases when compared to August . According to market sources, demand lethargy along with weak energy markets continued to lead the market despite limited allocations.

Emirati markets down after 2-month uptrend

In the United Arab Emirates, Middle Eastern suppliers revealed their initial September PP and PE offers with rollovers to up to $20/ton decreases when compared to the latest August levels. “Players engage in fresh purchases cautiously as bearish costs keep the downward pressure on prices,” a manufacturer opined.

On a related note, local PP prices were assessed largely stable after the $50/ton increases issued during August.

East Med markets stabilize for Sept; war woes keep supplies restrained

In East Mediterranean region, PP and PE prices have not not seen much change from August , when players received $40-80/ton increases. The Lebanese market has been particularly challenging due to the ongoing economic crisis and political instability. The local currency’s depreciation has exacerbated the situation, making imports prohibitively expensive for many businesses.

Similar to Lebanon, the depreciation of the Jordanian dinar against the USD has further compounded the weakness for import demand. “The combination of high import costs amid the increases issued in August and a weak currency is making it difficult for businesses to remain competitive," a local source opined.

Players: Bear sentiment to pervade October markets

Over the near term, players expect the softer sentiment to pervade Middle Eastern polyolefins markets next month, citing unfavorable economic and political conditions across the bloc. According to players, the relative strength of PE markets during September was attributed to the global markets, where sellers have sought price hikes both in Europe and Asia amidst the absence of major competitive pressure from the US.

Plus, LDPE has been relatively tight, and the agricultural season remains underway in the northern hemisphere. “However, October prices are expected to surface on the weak side unless the energy complex shows a visible rebound or demand revives in key global markets,” a regional source illustrated.