PE markets track divergent paths in China and Europe
The pressure on European LDPE and LLDPE is the strongest as imports from the Middle East were reduced to a large extent due to the output interruptions. Regional shutdowns also reinforced tightness in the market.
However, inventories are growing in China’s local market due to the thin buying interest. LDPE prices both in the local and import market witnessed the sharpest declines among other PE products. According to the ChemOrbis Price Wizard, import LDPE prices have lost around $70/ton when compared to the pre-holiday levels on average while local prices posted sharper decreases of around $220/ton in the same timeframe. “Demand for LDPE is the weakest among PE products,” noted a trader. Data reveals that European LDPE prices surged by €106/ton while LLDPE prices indicate €124/ton increases compared to the early January levels.
Traders in China focus on re-exporting their cargoes to other markets in order to achieve better netbacks given the fact that buyers can meet their urgent needs from the local market at more competitive levels.
Although both markets are likely to sustain their current trends with tight supplies and higher costs on the one side and high stocks in China’s domestic market and falling futures prices on the other side, sentiment may shift when the market digests high stocks and PE shutdowns start in China and crackers return from maintenance in Europe.
More free plastics newsPlastic resin (PP, LDPE, LLDPE ,HDPE, PVC, GPS; HIPS, PET, ABS) prices, polymer market trends, and more...
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