Middle Eastern markets start 2016 on a weaker note
A major Saudi Arabian producer issued decreases in their own local market while the producer’s new prices indicate SAR150-188/ton ($40-80/ton) decreases for PE and SAR263/ton ($70/ton) drops for PP on an FD Jeddah, Saudi Arabia, cash basis.
A trader operating in Jeddah reported, “We believe that the market state signals an even more bearish trend for January since a major local producer issued very noticeable decreases on their January offers. Generally, other local producers offer at a discount when compared to this major producer’s offers and their large decreases are likely to apply further pressure on prices and harm our margins even more.”
A Saudi converter, who underlined the comfortable supply situation, commented, “Supplies have been good in the market even in the absence of one of the local producers, who shut their plant for maintenance in October. The producer is set to restart their plant in mid-January.”
In order to track weekly developments in the Middle East’s PP market, please see our bi-weekly Polymer Digest Middle East Weekly PP Analysis (For members only)
In the United Arab Emirates, both local and the Middle Eastern producers issued their January PP and PE prices with decreases.
The local producer issued $130/ton decreases on their homo PP offers while they cut their PE offers by $10-80/ton when compared to last month on an FD Dubai, United Arab Emirates, cash basis. In the import market, a major Saudi Arabian producer lowered their PP raffia and injection prices by $60/ton to the Emirates while they issued $50-70/ton decreases for PE.
A trader who received new January import offers from different suppliers commented, “All January offers indicate decreases and sellers are still open to negotiations. For example, a major Saudi Arabian producer revised down their initial January HDPE film offers by $40/ton this past week.”
In order to track weekly developments in the Middle East’s PE market, please see our bi-weekly Polymer Digest Middle East Weekly PE Analysis (For members only)
In Jordan, players initially reported decreases of around $40/ton for PP and rollovers for PE from different Middle Eastern producers for January. However, they were mostly anticipating further reductions on January import prices as the month proceeded when considering the thin buying interest and comfortable supply levels, especially in the local market.
In line with these expectations, lower price levels emerged in the market during this past week. A Jordanian converter received $20-40/ton lower prices from a major Saudi producer while, according to him, an Emirati producer’s HDPE film offers indicate $60/ton declines from their early January levels.
The buyer remarked, “Prices remain on a softening note as trading activities are still sluggish. Although revised down prices emerged in the market during this past week, players still try to achieve lower deal levels. Meanwhile, the Emirati producer was already reported to have sold out their rather limited cargoes at competitive levels.” The buyer also touched upon their end product demand and said that they see no improvement at all.
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