PP, PE players in Asia voice post-holiday expectations
An agent from Vietnam commented, “We didn’t reveal new February offers yet, but we plan to apply increases due to higher prices of raw materials. Prices have room to increase after Chinese New Year against the backdrop of maintenance shutdowns, strong energy and upstream markets; however, low demand and high inventories might limit the extent of the increases next month.”
On the other side of the coin, some players will be back to their desks only towards the end of February and buyers with comfortable inventories are expected to take a wait and see stance after holidays.
A manufacturer in China noted that prices are traditionally going downwards in February and rebound in March. “However, it is hard to make a prediction about the outlook as this trend was not followed last year and it will depend on market activities after Chinese New Year. Apart from that, we heard that there are a lot of US cargoes of HDPE arriving in China this month,” added the buyer.
Some players also believe that the arrival of the deep sea cargoes might ease supply woes in the market and put pressure on prices. A seller reported, “More cargoes of US, Brazilian and Indian origins have arrived at the end of December, which might exert downward pressure on HDPE and LDPE film prices.” These comments were recently backed up by the latest import statistics for the month of December as reported by ChemOrbis China Import Statistics which saw a significant rise for the month.
A distributor confirmed that they still prefer to source local material rather than imports. The seller stated, “US cargoes were supposed to arrive by March; however, we heard that there might be some delivery delays to the Chinese market. After Chinese New Year, there will be a lot of US material arriving in China while Mid-eastern cargoes are expected to be less. We think that the market will rebound after Chinese New Year.”
A distributor in Indonesia reminded, “Despite production outages from Middle East, allocations from this region were not affected.”
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