SSESSMENTS.COM noted that movement in China PE prices this week will affect May shipment pricing from a Middle Eastern PE producer to the Southeast Asia market. A Middle Eastern PE producer stated that how China prices develop until the end of this week will affect the pricing for May shipment from their company to Southeast Asia. For May shipment, Southeast Asia prices would remain slightly lower than China’s level. Assuming that the crude oil prices maintained at around $28-30/ton for Brent, the producer thinks that Southeast Asia PE prices should remain above $700/ton-level for May shipment.
Speaking of the recent trend in China market, the producer source opined to SSESSMENTS.COM that the China market movement seems to be following crude oil prices recently, thus market players in China are closely monitoring crude oil prices. Another reason supporting the newest uptrend in China was the lower inventory from the country’s leading polyolefins producers. However, with the crude oil prices decreasing over a few days, China futures market softened and buying sentiment also started to weaken.
Further added, most producers will prefer to sell more to China considering the stronger demand and better pricing. Southeast Asia market would only start improving by around June for most of the countries. As for Indonesia, the producer opined that it might take a longer time for the country to recover from the Coronavirus impact. However, by the third quarter of the year, which is the traditional peak season for PE, the Southeast Asia market should be stronger, SSESSMENTS.COM was told.
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