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STATS: China’s Jan-July PE imports lowest since 2017, exports hit fresh record high

by Merve Sezgün - msezgun@chemorbis.com
by Pınar Polat - ppolat@chemorbis.com
  • 01/09/2022 (08:51)
China’s cumulative PE imports in the first seven months of 2022 were 13% lower than the previous year to reach slightly more than 7.5 million tons, the lowest January-July volume since 2017. Exports, on the other hand, rose 39% on the year to 436,510 tons.

Although the export PE volume is a quite small amount with respect to imports, it still suggests a record-high, according to ChemOrbis Stats Wizard data.

The country’s PE market has been under pressure from rising supply and weak demand since April, as end-use consumption has taken a big hit from tightened Covid curbs at home as well as high global inflation and economic slowdown. CIF China basis LDPE, HDPE and LLDPE film prices are currently standing at around two-year lows, based on the weekly average data on ChemOrbis Price Index, meanwhile.

PE – Import – China

Cumulative HDPE imports in Jan-July at lowest since 2016

In product-based breakdown, HDPE imports to China declined by around 12.5% on a yearly comparison in the January-July period to be reported at around 3.4 million tons. This indicates the lowest cumulative level since 2016, ChemOrbis data show.

Saudi Arabia was the main HDPE supplier of China with 740,197 tons during this period, followed by the United Arab Emirates (728,954 tons) and Iran (611,433 tons).

The total volume of HDPE exports out of the country was standing at 175,870 tons from January to July 2022, down by 13% from the same period of last year.

LLDPE exports in Jan-July climb on year

ChemOrbis data highlights that export LLDPE out of China in the January-July period jumped 146% compared to the same period last year to stand at 116,135 tons.

As for imports, data also show that total LLDPE imports to China in the same period were standing at nearly 2.5 million tons, down by around 18% on year. The total volume fell below 3 million tons for the first time since 2018.

Saudi Arabia was the main LLDPE supplier of China with 591,842 tons during this period, followed by Singapore (534,235 tons) and Thailand (261,880 tons).

LDPE exports in Jan-July also rise on year, but slower than LLDPE

ChemOrbis data highlights that China’s LDPE exports in the first seven months of the year increased by 27.5% from the same period of 2021 to stand at 117,193 tons.

As for LDPE imports, data also show that China’s imports for the particular grade in the January-July period were down by 7% on a year-over-year comparison to stand at 1.7 million tons, marking the lowest cumulative volume since 2018.

Iran was the main LDPE supplier of China with 425,645 tons during this period, followed by the United Arab Emirates (215,166 tons) and Saudi Arabia (200,559 tons).

China’s reduced demand threatens to overwhelm global PE markets

Based on stats data, it is now obvious that China’s total PE imports for 2022 will be lower than last year unless the zero-COVID policy is abandoned in the last quarter.

In the meantime, demand towards end-products has taken another hit from a six-decade high heatwave, which forced some downstream factories to go offline temporarily in 19 cities, including the major manufacturing hub, Sichuan.

Players commented that the shutdown of downstream production could weigh on PE demand further in the near term despite the approaching peak buying season, called “Golden September, Silver October”.

As China is the world’s top PE buyer, the impact of any drops in its imports will be felt on a global scale.

Dow Chemical, the world’s second largest PE producer, announced in a letter to customers on August 24 that they cut global production by 15% temporarily. The PE giant’s rate cut decision highlights the weakness of demand, particularly in China.
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