SE Asia’s polyolefin markets slightly up post-holiday; PE fares better than PP

Import PP and PE prices in Southeast Asia witnessed renewed increases following the Lunar New Year holidays, as most overseas suppliers approached the region with small hikes, pointing to tight supplies and rising costs. Sellers noted that sentiment for PE fared a tad better than PP given its tighter availability.

Initial ME offers after CNY point to supplier’s ongoing firm stance

While most converters across the regional markets prefer to stay sidelined to monitor suppliers’ post-holiday pricing strategies, several Middle Eastern producers have maintained their firm stance and revealed fresh hikes on their offers, citing rising input costs and reduced supplies.

A source from a Mid-Eastern PE producer said, “Post-Chinese New Year, we have increased our offers due to tight supply conditions exacerbated by our planned shutdowns of LD and LL production in Q2. We aim to prioritize contract customers, reducing production rates and allocation for spot buyers. Currently, there’s no selling pressure, but demand is moderate as buyers are cautious about high prices, preferring to wait for a market downturn.” The source added, “Competitive US cargoes, albeit slower in delivery, may entice buyers if priced below $980/ton CIF, although such offers haven’t been heard yet.”

Latest offer levels for Mid-Eastern origins stand at $1120/ton for LDPE film, $1020-1050/ton for LLDPE film, and at $1050-1060/ton for HDPE film, all on CIF SEA, cash basis. As for homo-PP raffia and injection, a trader reported one level for a Saudi shipment at $1040/ton with the same terms.

Supply pressure keeps PE sentiment a tad better than PP

A trader operating in Vietnam commented, “We have limited allocation for both HDPE and LLDPE. Demand for PE is not too bad amid reduced supplies. However, PP demand is sluggish due to high prices, and some buyers restocking cargoes at competitive levels pre-Chinese New Year. With ample local and NEA supply and weaker demand compared to PE, raising PP prices is challenging.”

While initial post-holiday PPH raffia offers from the Middle East stood at $1040/ton CIF, players reported Chinese and South Korean shipments at $970-980/ton CIF.

“We expect the region’s polyolefin markets to sustain the current firmness at least until March due to supply constraints and high costs. However, buyers are not in a hurry to make fresh purchases particularly for PP, as they can easily find Northeast Asian shipments,” another trader said.