Saudi major announces April PP, PE prices with sizeable drops as lockdown ramps up
Lockdowns, curfews enacted amid COVID-19 in S. Arabia
Among countries that have taken such measures is Saudi Arabia, which currently has the highest number of confirmed cases in the Gulf region. Saudi authorities responded to the escalation of the COVID-19 outbreak by suspending all international flights into the country and reducing the workforce in the public and private sectors. The authorities also mandated a curfew and several cities were locked down in quarantine procedure.
On March 29, the port city of Jeddah became the latest city to go under a lockdown. The curfew was also brought forward to begin at 3 pm instead of 7 pm in the country’s commercial hub. With a total capacity of around 7 million TEUs, Jeddah seaport handles 65% of Saudi Arabia’s imports by sea and is the second-busiest port in the Arab world.
Although the kingdom’s Ministry of Interior listed port operations among sectors exempt from the curfew, Saudi players reported facing challenges with shipping and logistics due to reduced capacity of officials and labour force. Players also reported facing difficulties in documentation procedures for shipments.
Saudi major drops offers sharply from March
For the past few weeks, the collapses in global oil prices, as well as the reduced demand amid the COVID-19 crisis, have also increased pressure on the markets. In the midst of these unprecedented circumstances, a major Saudi supplier approached the local market with sharp drops for PP and PE grades.
The major producer’s new offers for PPH raffia and inj., PPH film, PPH fibre, LLDPE C4 film, HDPE b/m, and HDPE inj. were all down by SAR300/ton ($80/ton) from March. For April, the producer decreased its offers by SAR263/ton ($70/ton) for HDPE film and by SAR169/ton ($45/ton) for LDPE film.
The latest drops brought the producer’s latest prices to SAR3413/ton ($938/ton) for PPH raffia and inj., SAR3525/ton ($908/ton) for PPH film and PPH fibre, SAR2850/ton ($759/ton) for LLDPE C4 film, SAR3075/ton ($819/ton) for HDPE b/m, SAR3000/ton ($799/ton) for HDPE inj. SAR3037/ton ($808/ton) for HDPE film and SAR3319/ton ($883/ton) for LDPE film, all FD Jeddah, cash.
Except for a slight pick-up during February, stemming from margin recovery attempts, the local market in Saudi Arabia has been trending downward since the second half of 2019.
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