Skip to content

Filter Options
Text :
Search Criteria :
Territory/Country :
Product Group/Product :
News Type :
My Favorites:
 

Turkey’s PE market enters holiday amidst weak July expectations

  • 23/06/2017 (19:23)
Players in Muslim countries are set to enter the Eid holiday soon while several participants in Turkey have already started to leave their desks. Trading for PE has remained at the bare minimum during the last working days left before holiday while early expectations among players call for lower July prices given a number of factors.

A manufacturer in Turkey noted, “We avoided large purchases and only met our needs from prompt cargoes in the local market. Modest price cuts are likely for polyolefins next month considering the weak outlook in China and lower production costs.” A Middle Eastern producer confirmed, “We are not receiving any calls while we are not that active either except for a deal we concluded with a $30/ton decrease for end June. The whole market entered the holiday mood.”

Buyers are citing a round of reasons for their weak expectations with most of them pointing to the bearish crude oil markets, which pulled spot naphtha and ethylene costs week over week. According to ChemOrbis data, spot ethylene prices on a CFR Far East Asia basis remained the lowest since February 2016 on a weekly average. Similarly, naphtha costs have hit 8 month lows on CFR Japan basis, the data revealed.

Another factor that weighs down on PE expectations is of the brand new PE capacities that are due to come on-stream soon in China, India as well as Iran and the USA as they caused concerns for a supply glut for PE in the coming term. “Demand in China has been mostly disappointing since the end of New Year holidays while woes about oversupply gained prominence for the second half of 2017,” commented a trader.

The lack of supply concerns in Turkey also adds to bearish expectations. PE deliveries from Qatar were not affected throughout June, as was confirmed by sellers and buyers, in spite of the previous expectations that stemmed from a political tension with the country and some other ones in the Middle East.

A converter in Turkey commented, “Moreover, neither a turnaround shutdown in Azeribaijan nor the recent protests at Petkim’s Aliaga facility created availability concerns as most buyers already secured their needs ahead of holiday and they expect to conclude their next deals at lower PE prices next month.” Furthermore, European cargoes emerged as there were deals for European LDPE and HDPE blow moulding during the last two weeks as they provided a competitive edge against other sources.
Free Trial