- Transactions and inquiries in Bangladesh PE market during Q2 2020 reported scarce
- COVID-19 was the biggest issue that hampered Bangladesh PE market
- Bangladeshi market players stated a cloudy demand outlook for Q3 2020
SSESSMENTS.COM noted that in the first month of Q2 2020, there were no deals concluded in the Bangladesh PE market. At the first half of April, the PE market in Bangladesh was practically on freeze since the government extended the coronavirus-related lockdown until April 13. During this time, most manufacturers shut the operation due to the sluggish demand amid lockdown. Within the week commencing April 13, a global trading house revealed sell ideas for Middle Eastern LDPE Film cargoes at $850/ton and between $750-780/ton for LLDPE Film C4. In the following week, the leading Indian petrochemical producer announced fresh PE offers to Bangladesh. LDPE Film was available at $820/ton, while LLDPE Film C4 at $720/ton. The offers received a cold response from buyers as they were not in a rush to stock up materials amid the slow market. Added to that, customers opted to wait for lower offers from other suppliers. In the final week of the month, customers’ buy idea for Middle Eastern HDPE Film and LLDPE Film C4 captured at $700/ton.
Moving to May, buying sentiment showed some improvement as supported by a rally in crude oil prices. However, there was a problem in payment since most local and national banks were unable to issue the Letter of Credit (LC). In the first week of May, Middle Eastern LLDPE Film C4 cargoes were available between $780-800/ton. Buyers had no intention to procure the cargoes as the buy idea stated was between $80-100/ton lower than the initial offers. Moving to the second week of the month, a global trading house only had offers for Saudi and Taiwanese LLDPE Film C4 cargoes with prices maintained unchanged on a weekly basis at $800/ton and $840/ton respectively. In the second half of May, SSESSMENTS.COM noted that there were no fresh offers available in the import market the majority of Bangladeshi market players were away from their desks for Eid Al-Fitr holiday.
In the first week of June, import LDPE Film and LLDPE Film C4 of various origins to Bangladesh market surged between $40-50/ton compared to the level before Eid Al-Fitr holiday. LLDPE Film C4 cargoes of India and Saudi origin were available above $800/ton-level. For Southeast Asian cargoes, during the same timeframe, Malaysian LDPE Film offered at $950/ton with the deals concluded at the initial offer level. On the week commencing June 8, sources revealed that a supplier quoted prices for US LLDPE Film C4 at $850-860/ton-level but deemed unattractive considering the long lead-time. In the third week of the month, SSESSMENTS.COM noted that the deals for Saudi LLDPE Film C4 achieved at $890/ton. While for LLDPE Film C4 of India and Taiwan origin recorded at $860/ton and $820/ton respectively. On the week commencing June 22, no fresh import PE offers were captured. All offers on LC at sight, CIF/CFR Chittagong Port.
Bangladesh PE market during Q2 2020 was severely affected by the coronavirus outbreak. SSESSMENTS.COM noted that the Bangladeshi government had imposed lockdown since March 26 and got extended for several times. Due to the lockdown, the number of transactions and inquiries was limited stemming from the slow sales for the end-products and payment issues. As the banks limited the operational hours during the lockdown, buyers were unable to open a Letter of Credit (LC) even if there were some deals concluded. Added to that, Eid Al-Fitr holiday also put Bangladesh PE market on mute during the second half of May. In June, the government decided to reimpose lockdown in several areas labelled as red-zones. Within the week commencing June 22, 15 out of 60 districts in Bangladesh have been labelled as red-zones, which hindered trading activities and dampened buying appetite. Buyers were more cautious about their spending and preferred to procure on an as-needed basis. On the production front, by the fourth week of June, most converters were running at 50% from the normal rate in an attempt to comply with the government regulation, aside from the factor that end-products demand remained slow.
Looking into Q3 2020, Bangladeshi market players stated a cloudy outlook as COVID-19 issue is still haunting. As long as this issue persists and the lockdown measures in the country remain in place, it will be difficult to see strong improvements in PE resins demand, as stated to SSESSMENTS.COM. In terms of pricing outlook, import PE prices predicted to remain firm as supported by the high feedstock prices and strong energy market.
Transactions for import PE in April on LC at sight, CIF/CFR Chittagong Port
| Origin | Product | Transaction Type | Offers (USD/ton) | Delivery Term |
|---|
| Far East Asia | HDPE Film | Offer Given | 750 | CFR |
| Middle East | HDPE Film | Buy Idea | 700 | CFR |
| North America | HDPE Film | Offer Received | 720-730 | CFR |
| North America | HDPE Film | Bid Given | 690 | CFR |
| Middle East | LDPE Film | Sell Idea | 850 | CIF |
| Indian Subcontinent | LDPE Film | Offer Received | 820 | CFR |
| Indian Subcontinent | LLDPE Film C4 | Offer Received | 750 | CFR |
| Middle East | LLDPE Film C4 | Sell Idea | 750-780 | CIF |
| Middle East | LLDPE Film C4 | Buy Idea | 700 | CFR |
| North America | LLDPE Film C4 | Offer Received | 720-730 | CFR |
| North America | LLDPE Film C4 | Bid Given | 690 | CFR |
Transactions for import PE in May on LC at sight, CFR Chittagong Port
| Origin | Product | Transaction Type | Offers (USD/ton) |
|---|
| Far East Asia | LDPE Film | Offer Received | 900 |
| Indian Subcontinent | LDPE Film | Offer Received | 820 |
| Middle East | LDPE Film | Sold | 810-820 |
| Far East Asia | LLDPE Film C4 | Offer Given | 840 |
| Indian Subcontinent | LLDPE Film C4 | Offer Received | 750 |
| Middle East | LLDPE Film C4 | Offer Received | 780-800 |
| Middle East | LLDPE Film C4 | Offer Given | 800 |
| Middle East | LLDPE Film C4 | Sold | 750-755 |
Transactions for import PE in June on LC at sight, CFR Chittagong Port
| Origin | Product | Transaction Type | Offers (USD/ton) |
|---|
| North America | HDPE Film | Offer Received | 900 |
| Far East Asia | HDPE Pipe (PE 100) | Offer Received | 1,070 |
| Indian Subcontinent | HDPE Yarn | Sell Idea | 910-920 |
| Southeast Asia | LDPE Film | Offer Given | 950 |
| Southeast Asia | LDPE Film | Sold | 950 |
| Far East Asia | LLDPE Film C4 | Offer Received | 820 |
| Indian Subcontinent | LLDPE Film C4 | Offer Given | 810-920 |
| Indian Subcontinent | LLDPE Film C4 | Sell Idea | 860 |
| Indian Subcontinent | LLDPE Film C4 | Sold | 830-920 |
| Middle East | LLDPE Film C4 | Offer Given | 800-890 |
| Middle East | LLDPE Film C4 | Sold | 890 |
| North America | LLDPE Film C4 | Sell Idea | 850-860 |
Tags: Asia Pacific,Bangladesh,English,ISC,PE,Quarterly
Published on July 9, 2020 11:20 AM (GMT+8)
Last Updated on September 18, 2020 3:14 PM (GMT+8)
