PP, PE imports gain competitive edge on strong euro in Europe
The €/USD currency hit more-than-a-two-year- high at 1.18 at the end of July while it was around 1.13 by late June, indicating an increase of more than 4%. The rate constantly hovered slightly above 1.18 until very recently but it eased to around 1.175 by the middle of this week.
Consequently, some European converters preferred to purchase import cargos in order to take advantage of the weak dollar instead of securing domestic spot cargos given speculations on possible hike attempts regarding September.
Middle Eastern HDPE blow moulding offers are currently reported at €1020/ton DDP Italy/Germany, 60 days, €30/ton below the low end of the local market. Currently, the local HDPE b/m market stands at €1050-1140/ton FD in the region.
A manufacturer in Italy purchased some Middle Eastern LLDPE at €1080/ton and LDPE at €1120-1130/ton, both DDP Italy, 60 days with materials due to be delivered in September. The recent local LLDPE and LDPE ranges are at €1150-1240/ton and €1180-1230/ton FD, respectively, meanwhile.
In Switzerland, Middle Eastern LLDPE c4 film was sold at €1100/ton DDP, 60 days with delivery in August, €50/ton below the low end of the current spot market. “We elected to purchase mainly from the import market this month while we heard about possible increase attempts for next month,” the buyer stated.
In the meantime, a Turkish trader reported, “We achieved better sales for Iranian PE to Europe so far in August compared to the previous months thanks to the weaker USD against the euro. We have sold half of our PE allocations to Europe in August compared to a 20% share in July.”
As for PP, A converter in Italy also purchased South Korean homo PP injection at €1030/ton and PPBC injection at €1070/ton DDP Italy, 60 days deferred payment. In Italy, the spot PP markets are reported at €1030-1150/ton for homo PP inj. and €1090-1200/ton for PPBC inj., both FD, 60 days, meanwhile, amidst deals on the low ends this week.
“As a part of building some safety stocks amidst the holiday lull, we secured import material from Korea for delivery in September amidst increase talks for the coming month in Europe,” the buyer noted.
A buyer in Switzerland also purchased duty-free Israeli homo PP injection at $1080/ton CIF, 60 days, which comes to €970/ton after converting it to the euro and adding applicable costs. This deal level is well below the local spot market, which is reported at €1050-1170/ton for homo PP inj. FD, 60 days.
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