Search posts by:

Search posts by:

Newsletter successfully sent
Failed to send newletter

WeeklySSESSMENTS: China PE Prices Week Starting June 15

Author: SSESSMENTS

Adjusted Offers Came As PE Market In China Exposed To Monomer Price Movements And Inventory Level

  • Buyers showing resistance towards local, localized PE cargoes priced above a certain level
  • PE prices supported by low inventory levels and firm monomer prices
  • Pricing outlook could change depends on end-product demand and incoming import cargoes

Latest domestic and import offers from producers appear with some changes as the China PE market is susceptible by some factors. As compared to the price list received on Friday, June 12, local PE and PP prices this week maintained stable, with exceptions for some grades. HDPE Yarn and LLDPE Film C4 moved up between CNY50-150/ton ($7-21/ton). In contrast, offers for HDPE Pipe (PE 100) decreased by CNY150/ton ($21/ton). A global trading house then informed that offers for localized LLDPE Film C4 cargoes from the leading Saudi polyolefins producer stood at CNY7,120/ton ($1,004/ton) on cash, EXW China basis and including 13% VAT, increased by CNY20/ton ($2/ton) as compared to the same period. SSESSMENTS.COM was told that the upswing in localized offers was owing to the depreciation of Chinese Yuan against the US Dollar. From the import market, offers for PE cargoes from the Middle Eastern producers remained stable from last week with HDPE Film being offered at $840-860/ton and LDPE Film at $880-900/ton, while LLDPE Film C4 at $790-800/ton. All import offers on LC at sight, CIF China Main Port basis.

Demand-wise, market players shared that now the fundamental demand for PE exists in China. As of Wednesday morning, the inventory level of the two leading polyolefins producers in China recorded at 695,000 tons, decreased significantly by 125,000 tons from Monday's level, while monomer prices remain firm. As such, local prices remain high with slight upward adjustments. However, most buyers were showing resistance towards the offers above CNY7,000/ton ($987/ton)-level, hence, unwilling to make purchases or only buying on a hand-to-mouth basis. Market players also told SSESSMENTS.COM that supply remains limited since mid-May when ethylene and propylene prices were hiked as well as other countries have gradually resumed their businesses following coronavirus lockdown. Following the market's general notion, domestic scarcity triggered as China is no longer limited to consuming after lockdown eased, Chinese sellers start selling their cargoes to other regions as well.

Looking ahead, some traders mentioned that buying sentiment for resins and the digestion rate for finished goods will affect the price movements. SSESSMENTS.COM noted with the increased cost of monomers, the cost of polyolefins will increase as well. Higher PE prices then will shore up in the market if buyers can get orders from end-users to make profits. Otherwise, lack of support from demand will push the upstream producers to adjust down the operating rate causing tightness in supply. Most market players then foresee the possibility for PE prices to go down once imported materials arrive at China ports, coupled with additional capacity from the new plants that are expected to start production by July.

Local/localized PE offers on cash, EXW China basis (including 13% VAT in CNY term, excluding VAT in USD term)

OriginProductTransaction TypeOffers (CNY/ton)Equivalent in USD/ton
ChinaHDPE Blow MouldingPrice List7,500936
ChinaHDPE FilmOffer Given7,500-7,700936-961
IranHDPE FilmOffer Given7,850-8,100979-1,011
ChinaHDPE FilmPrice List7,600948
ChinaHDPE Pipe (PE 100)Price List7,950992
ChinaHDPE YarnPrice List7,100-7,300886-911
ChinaLDPE FilmOffer Given7,800973
IranLDPE FilmOffer Given8,000998
ChinaLDPE FilmPrice List7,800-8,000973-998
ChinaLLDPE Film C4Offer Given6,700-7,100836-886
QatarLLDPE Film C4Offer Received7,030877
Saudi ArabiaLLDPE Film C4Offer Received7,120888
ChinaLLDPE Film C4Price List6,900-7,050861-879
ChinaLLDPE Film C4 (CTO)*Sold6,700-6,740836-841
Description: *CTO = coal-based materials

Import PE offers on CIF China Main Port basis

OriginProductTransaction TypeOffers (USD/ton)Payment Term
Middle EastHDPE FilmOffer Given840-860LC at sight
Middle EastHDPE FilmOffer Received850-870LC at sight
North AmericaHDPE FilmOffer Given820-830TT
Far East AsiaHDPE FilmOffer Given870*LC 90 days
Far East AsiaHDPE FilmSold870*LC 90 days
Southeast AsiaHDPE FilmOffer Received900**LC at sight
Southeast AsiaHDPE FilmSold850LC at sight
Southeast AsiaHDPE Pipe (PE 100)Offer Received930**LC at sight
Southeast AsiaHDPE YarnOffer Received850-860**LC at sight
Middle EastLDPE FilmOffer Given880-900LC at sight
Middle EastLDPE FilmOffer Received885-910LC at sight
Middle EastLLDPE Film C4Offer Given790-800LC at sight
Middle EastLLDPE Film C4Offer Received800-810LC at sight
North AmericaLLDPE Film C4Offer Received800LC at sight
Southeast AsiamLLDPE C6Offer Received930**LC at sight
Description: *July shipment; **Late July shipment

Tags: Asia Pacific,China,English,NEA,PE,Weekly

Published on June 18, 2020 12:27 PM (GMT+8)
Last Updated on June 23, 2020 4:38 PM (GMT+8)