Aggressive US PE offers deepen North Africa slide for August

In North Africa, Middle Eastern sellers were forced to yield to the mounting pressure from competitive US PE offers. Early in the month, US-origin material surfaced with price advantages exceeding $100/ton over Middle Eastern counterparts, intensifying pressure on regional suppliers and reshaping market dynamics.

Morocco takes the lead in competitive US offers

In Morocco, a major Saudi major stepped back from its initial August offers, which indicated rollovers to up to €30/ton ($35/ton) decreases from July and issued additional discounts of up to €50/ton ($58/ton) on certain grades, narrowing the significant price gap between the two origins seen earlier in the month.

“Middle Eastern sellers find difficulties in maintaining their initial prices amidst weakened demand and competitive US PE origins hence revised them down,” stated a local manufacturer, adding that the bearish sentiment is expected to extend into September as sluggish demand and US flood specially in the year end is expected to keep prices depressed.

Algeria and Tunisia follow suit

Earlier in August, Algeria and Tunisia saw Middle Eastern offers on a stable to slightly softer note. As the month wore on, PP and PE markets were assessed $20-30/ton lower in Algeria and €10-40/ton ($12-47/ton) lower in Tunisia when compared to initial August levels. Players also referred to dampened demand and globally bearish sentiment as they enforced further price reductions.

US PE remains attractively-priced

Despite the downward revisions in Middle Eastern origins, US PE cargoes retained their competitive edge, continuing to dominate the lower end of the HDPE and LLDPE price ranges across the region.

As ChemOrbis Daily Prices Summary section suggests, Middle Eastern origins were down by around $25-50/ton in the latter part of August from earlier in month to $1020-1065/ton for HDPE film and LLDPE film, $1030-1065/ton for HDPE bm and injection, all on CFR, cash/90 days basis.

Meanwhile, US HDPE film, blow moulding and LLDPE film offers were reported at €880-900/ton (around $920-945/ton), again on CIF North Africa, cash basis.