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PE players in China discuss Oct outlook; restarts come into play

by ChemOrbis Editorial Team -
  • 26/09/2016 (09:42)
Players in China reported that the upward momentum in PE prices slowed over the past week after several weeks of steady gains. Demand for LDPE film reportedly remains strong in the midst of ongoing tightness while market comments on LLDPE and HDPE are mostly suggesting that upcoming plant restarts in China might exert pressure on these products in the near term.

The National Day holidays which will take place for one week in October are also seen as a factor to slow down the market. “LLDPE demand is already poor despite the high season for agricultural film and it will be even slower in October in the face of increasing supply levels coupled with the upcoming holidays,” a player opined.

Market sources note that China’s Shenyang Chemical restarted its 100,000 tons/year LLDPE plant in Liaoning province on September 16. The plant was shut on August 15 for a scheduled maintenance. Sinopec Sabic Tianjin Petrochemical is also set to restart its 300,000 tons/year HDPE plant and LLDPE plant with the same capacity on September 25 following a turnaround. These plants were shut on August 11. Shanxi Yanchang Petroleum’s 600,000 tons year HDPE/LLDPE swing plant is also expected to be restarted as of September 5 following a maintenance, which started on August 10.

A trader operating in China reported last week, “We believe that Shenyang Petrochemical’s LLDPE line and Shanghai Golden Philips Petrochemical’s HDPE line will be restarted this week. Therefore, supply of HDPE and LLDPE is expected to increase. Plus, October will be a short month due to the one-week long National Day holidays. We expect PE prices to go down in the short term.”

Apart from these, Lanzhou Petrochemical is planning to restart its three plants at the end of September after turnarounds started in August. The company shut its 360,000 tons/year HDPE/LLDPE swing plant on August 7 while the company’s 170,000 tons/year HDPE plant and 200,000 tons/year LDPE unit at the same site were shut on August 11.

A trader who also expects supply to increase gradually noted, “Fushun Petrochemical has shut their old HDPE line with 150,000 tons/year production capacity from September 15 to 22. Zhongsha Tianjin’s 300,000 tons /year LLDPE and HDPE plant with the same capacity is also expected to be restarted on September 25. The producer had started maintenance on August 15.”

Another trader reported, “Fushun Petrochemical just restarted their HDPE line while Zhongmei Yulin and Tianjin Lianhoe just restarted their LLDPE line recently.”
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