Supply Condition Boosted Demand For Certain PE Grades In India
- A local producer adjusted local offers with effect from July 23
- Satisfactory demand is recorded for certain PE grades
- Room for local and import offers to increase further is limited
Market sources informed SSESSMENTS.COM that the current supply condition boosts demand for certain PE grades in India. With effect from July 23, a local producer increased the offers for HM HDPE and HDPE Blow Moulding by INR1,000/ton ($13/ton). While for other HDPE grades as well as LLDPE grades, the offers remained unchanged. From the import market, the offers received for Middle Eastern HDPE Blow Moulding were between $910-920/ton, which is stable on a weekly comparison. Sources also revealed that August shipment offers from a United Arab Emirates producer to India market surfaced with a hefty increase. Compared to last month, the offers increased between $70-90/ton for HDPE Film and by $60/ton for LDPE Film. For HDPE Film, deals were concluded at the initial offer level at $930/ton. As for the other grades, done deals were limited as customers voiced out acceptable price levels at around $900-920/ton, which is between $30-50/ton lower than the initial offer levels. All import offers on LC at sight, CIF India Main Port basis.
In terms of demand, there is no significant improvement recorded from last week, and satisfactory demand is captured for HDPE grades and LDPE Film as supported by the limited availability in the domestic market. Hence, the demand for import HDPE grades and LDPE Film is considered good in India. As for LLDPE Film C4, buyers prefer to source locally as the supply for this particular is ample. Following price increases made by local producers, some traders reported to SSESSMENTS.COM that customers were stimulated to start building inventory. As such, the inventory from the trader’s end continuously digested. In the production sector, sources mentioned that downstream factories keep running at a reduced rate between 50-80% from the normal rate since the demand for finished products is still below expectation.
Pertaining to the outlook, the majority of Indian market players voiced out opinion to SSESSMENTS.COM that the room for local and import PE offers to increase further is limited as buyers claimed that the current offers are already too high. However, some players believe that prices would not drop either considering the tight supply for certain PE grades.
