Bangladesh PE Market Wilt On Monsoon Season, Concern Over Second Wave Of Infections
- Shipment from India got delayed
- Rainy season, virus resurgence dampen demand
- Pricing outlook firm on firm crude oil prices
Bangladeshi market players revealed to SSESSMENTS.COM that Bangladesh PE market is wilting due to the monsoon season and an alarming resurgence of coronavirus cases nationwide. In the import market, Bangladesh import PE prices continue their upward run this week, shifting in the same direction for two consecutive weeks. For Indian origin, current offers for LLDPE Film C4 from the leading Indian petrochemical producer are available in the market at $40/ton higher than offer level available last week, captured at $950/ton. However, some suppliers quoted offers to Bangladesh market at $20/ton higher than the producer’s price list. As traders were willing to entertain requests for discounts, most transactions were concluded lower than the initial offer level. The leading Indian petrochemical producer also initiated a price increase of between $30-50/ton for LDPE Film cargoes to the market as compared to a fortnight ago. As for North America origin, some buyers received import offers for US LLDPE Film C4 cargoes at $860/ton. All offers are on LC at sight, CFR Chittagong Port. Sources in Bangladesh pointed out that buyers were reluctant to accept higher prices last week, demanding suppliers to set off a round of price cuts. However, as suppliers announced higher offers for July shipment prices, hence, some buyers moved to get ahead of further increases, more willing to accept price increases this week.
Despite the market sentiment turning more bullish this week, Bangladesh PE market continues to face immense downward pressure as concerns over a second wave of coronavirus infections and the onset of monsoon season in the country continue to weigh on demand. With the monsoon setting in and onrush of hilly water from the upstream, several districts in the northern and eastern regions of the country have been battling against floods, which could lead to disruptions to local supply chains. Several converters have been actively seeking spot cargoes for monthly production needs, but opted to purchase the materials on a hand-to-mouth basis only. On the supply front, some Indian producers told SSESSMENTS.COM that shipments of cargoes to Bangladesh market will be delayed due to the shortage, citing that producers prefer to offload more volumes in the domestic market amid supportive demand.
For the outlook, market players in Bangladesh foresee that the uptrend in import prices would not be short-lived as supported by firmer crude oil prices, despite a still-climbing death toll from the coronavirus pandemic. On demand outlook, some sources voiced out to SSESSMENTS.COM that growing concern over the second wave of infections and rainy season would continue to put a damper on the demand in the days to come.
