Vietnam PP, PE markets keep rising but some cautiousness remains
Easing restrictions set stage for recovery
Vietnamese markets have been on a cautious but steady uptrend since late April. This was partly attributed to easing COVID-19 restrictions. With no fatalities as a result of the COVID-19 to date, Vietnam became the first Southeast Asian country to start easing restrictions from late April.
Firming feedstock costs also provide support
ChemOrbis Price Wizard data show that spot naphtha prices on CFR Japan basis ended last week at their highest levels since early March, largely as a result of stronger crude oil.
This in turn was reflected in spot ethylene prices on CFR China basis. Accordingly, Asian ethylene markets have gained $320/ton, or 90%, within the last four weeks.
In addition to higher feedstock costs, signs of partial demand recovery also resulted in price increases from import suppliers. By mid-May, sellers started approaching the Vietnamese markets with higher offers than those for other Southeast Asian markets.
Markets gain 7-8% on average since April
As the graph below shows, the weekly averages of import HDPE, LDPE, and LLDPE film prices on CIF Vietnam basis have increased by an average of more than 7% since late April. Meanwhile, PPH offers have gained by around 8% on average since the uptrend kicked off in mid-April.
New offers indicate fresh increases
A trader offered Saudi PPH with an increase of $20/ton over last week at $870/ton, adding that their PE offers were also $40-50/ton higher month-on-month. “There isn’t too much material at this moment, particularly for PP. While demand is not bad, we hope to see better interest over the near-term,” he said.
PPH offers of Asian origins saw larger increases on a weekly basis, as high as $50/ton for certain grades.
Players mindful of short-term uncertainties
However, most players reported that purchasing was kept at minimum levels as the air of uncertainty lingered over the markets.
“We cannot foresee where this trend will take prices, but we do not expect to see sharp drops,” a player said, highlighting that more countries are preparing to ease restrictions.
More free plastics newsPlastic resin (PP, LDPE, LLDPE ,HDPE, PVC, GPS; HIPS, PET, ABS) prices, polymer market trends, and more...
- ABS, PS uptrend falters in China after H1 2020 ends at multi-month highs
- Stats: China’s total PP imports spike in May; Vietnam and India’s rising shares shine out
- Tight supply drives HDPE, LLDPE gains in Southeast Asia
- European PE markets set for 2nd bullish month on rising costs
- Turkey’s PP and PE markets propelled to a firm start to H2 despite vulnerable conditions
- Asian PVC sees V-shaped recovery in Q2, what will Q3 bring?
- Will capacity additions cast cloud on ethylene upsurge in Asia?
- US PVC offers in Egypt rise steadily but resistance grows in tandem
- PE buyers’ resistance grows in SEA; duty-free origins more competitive than Mid-East
- Polymer demand cools in Turkey: Is price correction ahead for PP, PE and PVC?