Some Sellers Started Revising PE Prices Following Negative Sentiment In China Market
- Some sellers adjusted both local and import offers
- Demand remains weak amid the traditional low season
- August market outlook is bearish
China market saw price adjustment on both local and import PE cargoes following negative sentiment. In the domestic market, a producer informed SSESSMENTS.COM that the company adjusted down their offers for LLDPE Film C4 by CNY50/ton ($7/ton) following market dynamics. On traders’ side, local offers for PE cargoes across all grades were also adjusted down between CNY100-300/ton ($14-42/ton), while localized cargoes dropped by CNY100-200/ton ($14-28/ton) as futures market on a downward trend. All on a weekly comparison.
In the import market, a Thai PE producer trimmed offers to the China market. As compared to Monday, July 20, the producer’s offers for HDPE Film surfaced with a reduction of $20/ton. Likewise, offers for LLDPE Film C4 decreased by $15/ton. Upon price reduction, the producer managed to sell some volumes for HDPE Film at the initial offer level while for LLDPE Film C4 at $5/ton lower on the low-end of the price range. Meanwhile, the leading Saudi polyolefins producer opted to lower HDPE Film and HDPE Blow Moulding offers by $20/ton as compared to last week’s offers. In contrast, the producer maintained stable offers for LDPE Film and LLDPE Film C4. A South Korean producer also chose to maintain export offers for HDPE Film to China stable from last week’s level. The producer told SSESSMENTS.COM they acknowledged that other suppliers were adjusting down the offers for PE grades, however, the company decided to monitor market development further before adjusting the offers. From the traders’ side, a global trading house revealed that a Saudi producer has decreased HDPE Film offers by $10/ton on a weekly comparison, available at $920/ton on LC at sight, CIF China Main Port basis.
Demand for PE in the China market remains slow amid the traditional low season. SSESSMENTS.COM noted floods with high-intensity rain descended around the middle part of China pushing down demand which already burdened by the decline in export for finished products due to trade war. Further added, market sources told that some buyers decided to skip placing bids this week since they believe prices might drop again next week. From the production side, market sources informed that CNOOC and Shell Petrochemicals Co Ltd (CSPC) halted production at its LLDPE unit for unplanned maintenance. As noted, the LLDPE unit no. 1 with a production capacity of 270,000 tons/year reportedly has been shut since Friday, July 17. Located in Guangdong province, China, the company’s LLDPE unit no. 1 is slated to be off-line for around one week. On the supply side, inventory levels of the two leading polyolefins producers in the country decreased by 65,000 tons compared to level on Monday, July 20, recorded at 715,000 tons as of Thursday morning (July 23).
Expressing their views on market outlook, market sources foresee that China’s PE market would remain bearish going into August. Suppliers may be looking for an upturn, but with no strong demand fundamentals to support any form of price hikes, there would be no room for PE prices to move higher. Traditionally, downstream demand for PE will enter a seasonal uptick from September to October. However, one of the producers voiced out to SSESSMENTS.COM that traditional peak demand could fail to materialize as the market continues to be unpredictable and changing rapidly this year.
Local/localized PE offers on cash, EXW China basis (including 13% VAT in CNY term, excluding VAT in USD term)
| Origin | Product | Transaction Type | Offers (CNY/ton) | Equivalent in USD/ton |
|---|
| China | HDPE Blow Moulding | Price List | 7,300 | 927 |
| China | HDPE Film | Offer Given | 8,300-8,600 | 1,050-1,088 |
| China | HDPE Film | Price List | 8,400 | 1,062 |
| Middle East | HDPE Film | Offer Given | 8,800-9,000 | 1,113-1,138 |
| USA | HDPE Film | Offer Given | 7,600 | 961 |
| China | HDPE Pipe (PE 100) | Price List | 8,100 | 1,024 |
| China | HDPE Yarn | Price List | 7,800-7,900 | 986-999 |
| China | LDPE Film | Offer Given | 8,700-8,850 | 1,100-1,119 |
| China | LDPE Film | Price List | 8,550 | 1,081 |
| Middle East | LDPE Film | Offer Given | 8,900-9,100 | 1,126-1,151 |
| China | LLDPE Film C4 | Offer Given | 7,200-7,600 | 910-961 |
| China | LLDPE Film C4 | Price List | 7,200-7,300 | 910-927 |
| Kuwait | LLDPE Film C4 | Offer Received | 7,160 | 906 |
| Middle East | LLDPE Film C4 | Offer Given | 7,500 | 948 |
| Saudi | LLDPE Film C4 | Offer Given | 7,600 | 961 |
Import PE offers on LC at sight, CIF/CFR China Main Port basis
| Origin | Product | Transaction Type | Offers (USD/ton) | Delivery Term |
|---|
| Middle East | HDPE Blow Moulding | Offer Given | 910 | CIF |
| Far East Asia | HDPE Film | Offer Given | 920-970 | CIF |
| Far East Asia | HDPE Film | Offer Received | 980-985 | CIF |
| Middle East | HDPE Film | Offer Given | 950-980 | CIF |
| Middle East | HDPE Film | Offer Received | 920-950 | CIF |
| Southeast Asia | HDPE Film | Offer Given | 960-1,030 | CIF |
| Southeast Asia | HDPE Film | Offer Received | 910-960 | CIF |
| Southeast Asia | HDPE Film | Sold | 960 | CFR |
| Southeast Asia | HDPE Film | Sold | 960 | CIF |
| Far East Asia | HDPE Pipe (PE 100) | Offer Given | 960 | CIF |
| Far East Asia | HDPE Pipe (PE 100) | Sold | 960 | CIF |
| Southeast Asia | HDPE Yarn | Offer Given | 900-940 | CIF |
| Middle East | LDPE Film | Offer Given | 960-1,030 | CIF |
| Middle East | LDPE Film | Offer Received | 990 | CIF |
| Southeast Asia | LDPE Film | Offer Given | 1,015 | CIF |
| Latin America | LLDPE Film C4 | Offer Received | 840 | CIF |
| Middle East | LLDPE Film C4 | Offer Given | 840-880 | CIF |
| Southeast Asia | LLDPE Film C4 | Offer Given | 885-900* | CIF |
| Southeast Asia | LLDPE Film C4 | Offer Given | 885 | CFR |
| Southeast Asia | LLDPE Film C4 | Offer Received | 885 | CIF |
| Southeast Asia | LLDPE Film C4 | Sold | 880 | CFR |
| Southeast Asia | LLDPE Film C4 | Sold | 880-885 | CIF |
Description: *offers on Monday, July 20
Tags: Asia Pacific,China,English,NEA,PE,Weekly
Published on July 23, 2020 2:02 PM (GMT+8)
Last Updated on July 23, 2020 2:56 PM (GMT+8)
