Saudi PE suppliers grant further price cuts to Turkey
A Saudi Arabian major applied additional drops on top of its initial reductions of $80/ton for this month. The producer’s latest LLDPE c4 film and HDPE film offers for prompt materials from bonded-warehouse indicated $10-20/ton drops from last week. A manufacturer who received lower prices from the producer reported, “We received slightly lower prices from our supplier. We prefer to purchase hand to mouth on a weekly basis as we feel that demand may not improve much after Ramadan.”
A different global producer also lowered its Saudi Arabian HDPE film and blow moulding offers by $30/ton from their initial June announcements. A source from the producer attributed their decision to the presence of competitive Uzbek materials, which have been influencing the market for the last few months. “Activity here has been depressed for some time and polymer markets are showcasing a weak performance. That’s why we reduced our allocation to Turkey. We will conduct an annual scheduled maintenance in October-November and we may not be offering regularly at that time,” the source stated.
Expectations for the near term diverge for PE. Some players think that the market may see the bottom after Ramadan and even shift direction in July given high crude oil prices particularly if suppliers reduce their allocations to Turkey. However, according to other players, an upturn is not likely if demand does not return considering the competitive pressure from Uzbek cargoes.
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