Slow Demand Looms Over Australia PE Market Despite Price Adjustment Made By Foreign Producers
- South Korean producer adjusted HDPE Pipe Black (100) offers
- Demand is not very strong since lockdown just lifted
- Prices are predicted to be stable to firmer onwards
Australian market sources informed SSESSMENTS.COM that this week import offers were generally stable, except for South Korean HDPE Pipe Black (100) dropped by $30-40/ton from a week ago. The price adjustment on South Korean cargoes was made due to stiff resistance from buyers towards the previous offer level. Meanwhile, a Saudi producer is offering the same materials at $870/ton. However, market talks have it that the producer is offering the cargoes at an attractive level to Australia market, at $840/ton-level. However, a trader is wondering if such a level is available in the market, citing such a level is not impossible since Australian market is often treated as a dumping ground by foreign producers where price levels usually will not affect other regions. This week, the trader also received offers from two Thai PE producers. The first producer offered HDPE Blow Moulding, HDPE Injection and HDPE Film at $770-775/ton. While the second producer offered HDPE Film and HDPE Blow Moulding at $840/ton, stable from last week with the reason as they only have a few cargoes. All offers on LC at sight, CIF Australia Main Port basis.
Speaking of the demand, SSESSMENTS.COM noted that as Australia has just opened the coronavirus-related lockdown and the recovery are still ongoing, thus overall demand for PE resins is not very strong. On the supply front, no significant issue reported by market players.
In terms of outlook, PE prices are expected to be stable to firmer onwards as feedstocks and energy markets have been rallying recently. Some US PE producers informed that they will increase prices by $60/ton next week. However, as the overall demand is still slow, market players opined to SSESSMENTS.COM that the foreign producers will find difficulties in concluding deals.
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