Localized PE offers on cash, EXW Delhi basis (excluding 18% GST in all terms)
Indian PE Market Remained Dampen Despite Changing Lockdown Condition
- PE price revisions from producers and traders following market trends
- Demand remains subdued while essential industry in green zone sector restarting production
- Outlook still depends on the lockdown imposition
Indian PE market conditions have not yet shown any significant development as lockdowns were extended in several regions in the country. Market sources informed SSESSMENTS.COM that the leading Indian petrochemical producer has revised local prices for May delivery. For PE, offers for HDPE Blow Moulding and LLDPE Film dropped by INR3,000/ton ($39/ton) and INR2,000/ton ($26/ton) respectively. While LDPE offers dipped by INR3,000/ton ($39/ton), except for LDPE Extrusion Coating and Lamination maintained stable. All with effect from May 1, 2020. Another source confirmed that the producer was selling in low quantities to maintain sufficient inventory during the lockdown.
LDPE Lamination itself is in demand for industry specialized in essential products that are permitted to operate by the government. Trader informed SSESSMENTS.COM that their LDPE Lamination inventory is at a low level and offered at quite competitive prices. The offer for localized LDPE Lamination cargoes of Singapore origin was in the range of INR100,000/ton ($1,327/ton) up to mid-April, while entering the week commencing from April 27 offers captured at INR130,000/ton ($1,726/ton). Following market trends, offers in the first week of May were adjusted down by INR10,000/ton ($132/ton) to INR120,000/ton ($1,593/ton) on cash, EXW Delhi basis and excluding 18% GST. From the import market, traders confirmed that there are no import offers for PE cargoes for this week.
SSESSMENTS.COM noted that the government outlined new guidelines on the country's designated color-coded zoning system. This system allows economic activity located in green zones (areas with no confirmed cases for 21 consecutive days) to restart operation with strict guidelines. The local distributor told that the industry around Kanpur, which is under the green zone, already started operating even though with a capacity of only reaching a maximum of 50% and concentrated on producing packaging. Most of India's major metropolitan areas, such as Mumbai and Delhi have been declared as red zones and will remain under strict lockdown measures until May 17. Despite lockdown relaxation, customers are not interested to buy with SSESSMENTS.COM yet to see any improvement in PE demand. On the supply front, no significant issue reported by the Indian market players.
In terms of outlook, Indian market players do not see any signs of improvement in PE demand in the upcoming week. The near term outlook for pricing and demand depends on India's economic condition during the lockdown.
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Tags: Asia Pacific,English,ISC,India,PE,Weekly
Published on May 7, 2020 1:19 PM (GMT+8)Last Updated on May 7, 2020 8:03 PM (GMT+8)
