Mid-Eastern PP, PE markets rangebound in June, holiday lull curbs activities

Players in the Middle Eastern PP and PE markets received June offers from regional sellers largely with rollovers from May, despite a few sporadic cases where PE has still seen small discounts passing and PP has pioneered price hikes in Saudi Arabia. The region’s upcoming Eid al-Adha holidays along with the persistent economic uncertainties and political turbulences continue to alert buyers and kept activities limited.

Saudi Arabia: PP and LLDPE buck the overall trend

In Saudi Arabia, new June PE offers from a major domestic producer indicated mostly rollovers from May for the second/third month in a row depending on the product LLDPE formed an exception as prices posted SAR75/ton ($20/ton) decreases when compared to May levels.

According to ChemOrbis Production News Pro, SEPC (Saudi Ethylene and Polyethylene Company) restarted operations at its LDPE unit in late May, after it was shut in late April for maintenance.

On the other hand, PP offers indicated slight increases of SAR23-60/ton ($6-16/ton) on a monthly basis. It is noteworthy that PP prices have turned bullish again after the decreases recorded in May following three months of price increases. According to local sources, trading activity is gradually retreating across all sectors with Eid al-Adha approaching and Saudi Arabia preparing for the annual Haji season.

Emirati markets at a standstill

In the United Arab Emirates, Middle Eastern suppliers revealed their initial June PP and PE offers mostly with rollovers compared to the previous month after recording modest decreases through May. Also, June offers from the country’s local PP producer indicated rollovers from May, marking the third month of consecutive steadiness. “The market remains quiet amidst the ongoing political tension as well as poor derivative demand approaching Eid festivities,” a market source opined.

East Med stable except for Lebanon’s PE market

In the East Mediterranean region, June PE prices to Jordan and Lebanon continued a steady to a softer path for the third month in a row. Players in Jordan reported steady offers whereas Lebanese players reported $20/ton lower offers from May. The economic landscape across the region remains strained by regional instability and economic challenges. The upcoming Eid al-Adha holiday has only compounded these issues with market players sidelined. Meanwhile, PP offers to the region were largely unchanged on a monthly comparison.

Holidays lull keeps sentiment weak; how about July?

Over the near term, players across the region expect no major prices changes until the end of June. The approaching holiday in Muslim countries coupled with the persistent weakness in derivative demand amidst lengthened supplies, all keep activities slow and the overall sentiment downbeat.

Nevertheless, the ongoing freight chaos in global shipping markets may reflect onto the offers to the region to spur price increases. PP prices in Saudi Arabia have already turned bullish while others may follow suit next month, although chronically low demand may curb any hike requests.