Vietnam’s local PP, PE markets extend decline amid lingering demand weakness

Vietnam’s domestic polyolefin markets prolonged their downward trajectory during the week ending October 10, trapped in a cycle of weak demand and cautious sentiment. Both PP and PE prices softened further, reaching multi-month or multi-year lows. Converters remained reluctant to replenish stocks amid sluggish end-product demand and expectations of additional price cuts. Meanwhile, supply stayed ample with steady import inflows and Long Son Petrochemicals’ ongoing commercial operations.

The downtrend persisted into the new week. As of Monday, October 13, both PP and PE prices saw fresh decreases of up to VND500,000/ton ($19/ton), as market sentiment remained bearish and buying activity continued to dwindle. “Demand is very bad. Prices keep dropping further. For now, I prefer to stay on the sidelines instead,” said a trader.

PP: Prices extend three-month downtrend

Vietnam’s domestic PP market retained its downtrend for the third consecutive month, with prices stabilizing or slipping slightly. Domestic homo-PP raffia prices were stable to VND200,000/ton ($8/ton) lower from the previous week, marking the lowest level since December 2023—near a two-year low, ChemOrbis data shows.

Despite the recent price declines, overall market sentiment remained subdued as converters continued to report weak downstream demand. “Prices have moved lower, but demand couldn’t improve. It’s not about prices now—it’s about demand,” said a converter, echoing a widespread sentiment of cautiousness.

Another buyer shared a similar stance, noting that prices were already quite low; still, he refrained from restocking, expecting further reductions ahead and citing weak end-product demand as a key deterrent.

PE: LL, LD at year-long lows, HD still defies tightness

The PE market mirrored the bearish tone, with local HDPE and LDPE film prices being stable to VND500,000/ton ($19/ton) lower, while LLDPE film fell by VND300,000-700,000/ton ($11-26/ton) week-on-week. ChemOrbis Price Index revealed that LDPE and LLDPE film prices hit their lowest level since April and October 2024, respectively, while HDPE film approached its nearly four-month low.

Compared to other film grades, HDPE film’s downswing remained relatively milder thanks to lingering tightness in supply. However, the shortage was insufficient to counterbalance the impact of muted demand. “Even though prices are low, we don’t plan to replenish inventory now. It’s still early to build inventory for year-end and next year,” commented a converter, reflecting the prevailing hesitancy among buyers despite attractive offers.

Additionally, Long Son’s ongoing commercial operations at competitive prices continued to exert downward pressure on domestic PE prices, pressuring prices for locally held cargoes from other sources.

Signs of demand recovery fail to inspire confidence

Market sentiment in Vietnam’s polyolefin sector remained fragile, with tentative signs of demand recovery yet to translate into stronger resin consumption. Some converters noted a mild pickup in end-product demand ahead of the traditional high season, but most agreed that it was insufficient to drive meaningful restocking.

Others painted a more pessimistic picture, describing current demand as “quite bad” and emphasizing that even successive price reductions failed to revive buying interest. Many buyers thus maintained a conservative stance, purchasing strictly on a need basis despite sellers’ efforts to spur restocking. “Demand is quite bad, so we’re not planning to buy more material for now. Sellers keep encouraging us to bid or replenish, but we prefer to stay in a wait-and-see mode,” said a Hanoi-based converter.

“Prices are quite low, but we keep postponing our replenishment plan. We believe there’s still room for prices to fall further, and it’s too early to start building inventory for year-end or next year. We might consider restocking around November or December,” another converter based in Ho Chi Minh City commented.