With coronavirus outbreak still ongoing in Australia, recovery on PE and PP market taking more time. A trader-based in Australia informed SSESSMENTS.COM regarding a rumour about PE and PP price movement from North American producers. Trader heard that mLLDPE C6 cargoes from North America will be quoted at $950/ton for July shipment; if such a level turns out to be true then North American offers have gone up by almost $100/ton on the monthly comparison. Also from trader’s account, Southeast Asian producers have not announced offers for HDPE Pipe Black (100) to date. Meanwhile, a North American producer asking customers, including trader itself, to bid PP Block Copolymer cargoes for July shipment.
The trader told SSESSMENTS.COM that the market is still on a recovery process after the coronavirus outbreak; thus demand isn't strong yet. According to the report by Jakarta Post, more than 30 suburbs in Melbourne being put back on lockdown on July 2 as the number of the new cases in Victoria reached more than 70 cases per day. From the supply sector, import offers for HDPE Pipe Black (100) to Australia is indeed tight at the moment as the local producer is not producing the grade. Additionally, foreign suppliers, such as a Thai producer is yet quoting offers due to maintenance at its HDPE plant scheduled from June 23 until July 22.
In terms of outlook, the trader shared their view to SSESSMENTS.COM that ethylene price cannot go up any further while uptrend wouldn't last long either. Sentiment building around the market that it is better to sell ethylene rather than selling PE to Australia market with feedstock prices, especially ethylene, is unusually high now. If most of the producers prefer to sell more ethylene, then theoretically ethylene availability shouldn't be that tight for time to come and PE price will be in retreat.
