Southeast Asian Market Players Questioned Sustainability Of Current PE Prices
- More than $100/ton adjustments were applied on local LLDPE Film C4 offers in Malaysia
- Most buyers prefer to hold procurement activities
- Demand is predicted to remain weak as Q3 is traditionally the low season for PE in Southeast Asia
Southeast Asian market players contacted by SSESSMENTS.COM questioned the sustainability of the current high PE prices. This week, local HDPE Film and LLDPE Film C4 offers in Thailand increased further by THB500/ton ($16/ton) compared to last week while offers for LDPE Film were maintained stable compared to the same period. In the Philippines, the high-end of offers for both grades were already at PHP57,000/ton ($1,143/ton) on cash, FD Philippines basis and including 12% VAT as the leading polyolefins producer in the country applied an upward adjustment of PHP3,000/ton ($60/ton) on HDPE Film offers and PHP2,000/ton ($40/ton) on LLDPE Film C4 offers last Thursday compared to offers on June 23. No further adjustments were made since then. In Malaysia, July delivery offers from a local producer surfaced with significant adjustments of MYR380/ton ($89/ton) for HDPE grades and MYR280/ton ($65/ton) for LDPE grades. As for LLDPE Film C4, offers via traders soared by MYR770/ton ($180/ton). The changes were compared to June delivery offers.
For imports, a Singapore-based trader offered LLDPE Film C4 of Saudi origin to Malaysia and Cambodia at $10/ton higher than sell ideas expressed last week. Deals for the same product of the United Arab Emirates origin via a global trading house concluded at $920/ton on LC at sight, CIF Thailand main port basis. The deals were $30/ton lower than the initial offer level. There were also deals concluded directly with the Emirati producer at $20/ton lower than the initial offers, at $900/ton with the same payment and delivery terms. For regional cargoes, offers for HDPE Film and LLDPE Film C4 of Thailand origin went up between $30-50/ton from last week’s levels. Detailed information for Indonesia and Vietnam market available in the WeeklySSESSMENTS of respective countries.
Overall, demand for PE in the region is soft, SSESSMENTS.COM was told. Buyers perceive the current PE offers as too high. Most prefer to hold procurement activities, anticipating lower prices later on. Moreover, converters across the region are facing slow end-products sales and some are still running at lower production rates. On the supply side, a Malaysian producer is having tight supply for almost all PE grades, except LDPE Film. Hence, the delivery is expected to be longer than usual. Similarly, Thai PE producers are also having limited allocation.
The majority of market players believe that there will be some downward adjustments on PE offers in the near future since demand is predicted to remain weak and unable to support high offers. Q3 is traditionally the low season for PE in Southeast Asia due to the rainy season, the players explained to SSESSMENTS.COM. However, there are also some players, especially in Malaysia, that expect PE prices to remain firm onwards owing to tight supply.
Local/localized PE offers on FD basis, excluding VAT in all terms (except in PHP term including 12% VAT)
| Origin | Product | Transaction Type | Currency | Offers/ton | Equivalent in USD/ton | Payment Term | Delivery Location |
|---|
| Malaysia | HDPE Blow Moulding | Price List | MYR | 4,040 | 942 | 30 Days Credit Term | Malaysia |
| Malaysia | HDPE Blow Moulding | Offer Received | MYR | 4,040 | 942 | 30 Days Credit Term | Malaysia |
| Philippines | HDPE Blow Moulding | Offer Received | PHP | 56,000 | 1,003 | Cash In Advance | Philippines |
| Malaysia | HDPE Film | Price List | MYR | 3,960 | 924 | 30 Days Credit Term | Malaysia |
| Malaysia | HDPE Film | Offer Given | MYR | 3,960 | 924 | 30 Days Credit Term | Malaysia |
| Philippines | HDPE Film | Offer Received | PHP | 56,000-57,000 | 1,003-1,021 | Cash In Advance | Philippines |
| Thailand | HDPE Film | Offer Given | THB | 30,000-31,000 | 967-999 | Cash In Advance | Thailand |
| Thailand | HDPE Film | Offer Received | THB | 31,000 | 999 | Cash In Advance | Thailand |
| Thailand | HDPE Film | Purchased | THB | 30,000-30,250 | 967-975 | Cash In Advance | Thailand |
| Malaysia | LDPE Film | Offer Given | MYR | 4,390 | 1,024 | 30 Days Credit Term | Malaysia |
| Malaysia | LDPE Film | Price List | MYR | 4,390-4,530 | 1,024-1,057 | 30 Days Credit Term | Malaysia |
| Malaysia | LDPE Film | Offer Given | THB | 32,500 | 1,047 | Cash In Advance | Thailand |
| Thailand | LDPE Film | Offer Given | THB | 34,500 | 1,112 | Cash In Advance | Thailand |
| Thailand | LDPE Film | Offer Received | THB | 34,000 | 1,096 | Cash In Advance | Thailand |
| Thailand | LDPE Film | Purchased | THB | 33,000-33,500 | 1,063-1,080 | Cash In Advance | Thailand |
| Malaysia | LLDPE Film C4 | Price List | MYR | 4,270 | 996 | 30 Days Credit Term | Malaysia |
| Malaysia | LLDPE Film C4 | Offer Received | MYR | 4,160 | 970 | 30 Days Credit Term | Malaysia |
| Philippines | LLDPE Film C4 | Offer Received | PHP | 55,000-57,000 | 985-1,021 | Cash In Advance | Philippines |
| Thailand | LLDPE Film C4 | Offer Given | THB | 30,000-31,000 | 967-999 | Cash In Advance | Thailand |
| Thailand | LLDPE Film C4 | Offer Received | THB | 31,000 | 999 | Cash In Advance | Thailand |
| Thailand | LLDPE Film C4 | Purchased | THB | 30,000-30,250 | 967-975 | Cash In Advance | Thailand |
Import PE offers on LC at sight, CIF Main Port basis
| Origin | Product | Transaction Type | Offers (USD/ton) | Delivery Country |
|---|
| Thailand | HDPE Film | Offer Given | 940-950 | Southeast Asia |
| Saudi | LLDPE Film C4 | Offer Given | 870 | Cambodia |
| Saudi | LLDPE Film C4 | Bid Received | 840 | Cambodia |
| Saudi | LLDPE Film C4 | Sold | 870 | Cambodia |
| Saudi | LLDPE Film C4 | Offer Given | 870 | Malaysia |
| Saudi | LLDPE Film C4 | Bid Received | 840 | Malaysia |
| Saudi | LLDPE Film C4 | Sold | 870 | Malaysia |
| Thailand | LLDPE Film C4 | Offer Given | 930 | Southeast Asia |
| United Arab Emirates | LLDPE Film C4 | Offer Received | 920 | Southeast Asia |
| United Arab Emirates | LLDPE Film C4 | Purchased | 900-920 | Thailand |
| USA | LLDPE Film C4 | Sold | 850 | Cambodia |
| USA | LLDPE Film C4 | Sold | 850 | Malaysia |
Tags: Asia Pacific,English,PE,SEA,Weekly
Published on July 2, 2020 2:14 PM (GMT+8)
Last Updated on July 2, 2020 8:46 PM (GMT+8)
