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PE offers retreat further in SEA market

by ChemOrbis Editorial Team -
  • 04/04/2017 (10:38)
In Southeast Asia, players across the region have received lower PE offers from their suppliers. The market continues to decrease in line with expectations in the midst of weak upstream costs, the slow digestion of stocks stemming from unsatisfactory demand from end users as well as the upcoming holidays in Thailand and the Philippines.

In the upstream markets, ethylene on CFR NEA basis declined by more than $200/ton while prices on CFR SEA basis posted smaller decreases of $110/ton when compared to early March levels standing at $1140/ton and at $1035/ton, respectively.

A trader in Vietnam reported that fresh PE offers from Taiwanese and Indian producers have moved lower from the previous week. The offers for Taiwanese HDPE grades declined by $40-45/ton and LLDPE grades by $25/ton. Similarly, HDPE grades for Indian origin are $20-25/ton lower while LLDPE grades are down by $10-15/ton. A Hanoi-based converter said, “Offers are moving lower but we are not planning to stock up as we feel prices still have room for further declines. Two weeks ago, our Middle Eastern supplier offered their HDPE film at $1220/ton before they decided to lower their offers to $1190/ton last week. As of now, the supplier is offering much lower at $1160-1170/ton CIF Vietnam, cash.”

In Indonesia, a Thai producer approached the market with a $10/ton decrease in their HDPE film offers at $1260/ton CIF Indonesia, cash. “Recently, the Thai producer offered HDPE film at $1250/ton CIF Philippines but we are not interested in placing bids as we believe import HDPE offers from the regional suppliers should be around or below $1200/ton CIF,”’ the converter commented. A second converter opined, “Since the Easter holiday is approaching, the Philippines market has remained quiet. Therefore, we are not interested in inquiring new import offers as we have sufficient inventory.”

Going forward, market players mostly voiced their opinions that they do not expect dramatic rebound in PE market as the demand within the region is rather muted. Meanwhile, it has not picked up yet either in the nearby Chinese market although it should be the peak season for agriculture sector. In addition, players are also keeping a close eye on the movements of crude oil markets.
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