Buying Sentiment And PE Demand In India Shifted After Nationwide Lockdown Eased
- Local and import PE prices move in the same direction
- Government plans to extend lockdown in high-risks or red zones until June 30
- Market players shared different opinions regarding pricing outlook
Market sources informed SSESSMENTS.COM that buying sentiment and PE demand in India shifted after the nationwide lockdown eased. On the week commencing June 1, both local and import PE prices in India were captured on an upward trend. The leading Indian petrochemical producer decided to adjust up local PE prices with effect from June 1, 2020. Offers for HDPE and LDPE grades from the producer increased by INR1,000/ton ($13/ton) except for HDPE Pipes, HM Pipe, LDPE HD, and LDPE Injection Moulding, the offers were rolled over. While offers for LLDPE grades moved up by INR2,000/ton ($27/ton). However, a local manufacturer mentioned that the actual offers from the producer only increased around INR500/ton ($7/ton) as the producer provides a discount scheme for buyers. Meanwhile, a trader maintained firm offers for local PE cargoes across all grades as supported by healthy demand at the company’s end. Current PE offers from the trader are available between INR66,000-75,000/ton ($879-999/ton) depending on grades, on cash, EXW Mumbai basis, and excluding 18% GST.
In the import market, offers for HDPE Film and LDPE Film from the leading Saudi polyolefins producer surged by $80/ton and $60/ton, respectively compared to last week’s levels. While for LLDPE Film C4, the offers are available at $800/ton on LC at sight, CIF India Main Port basis, SSESSMENTS.COM noted. However, these offers are deemed too high as India market is still highly affected by the COVID-19. As for other cargoes, a manufacturer purchased 200 tons of Middle Eastern HDPE Film at $770/ton on the same payment and delivery terms.
As noted, the Indian government plans to extend the lockdown in high-risk or red zones until June 30. However, the government will allow businesses and services to resume operation and lifted most restrictions but will ensure physical distancing and limited business hours. With more businesses reopen, buying sentiment in India improved and healthy PE demand recorded this week as most buyers start to replenish materials. In contrast, manufacturers stated that demand for finished products remains slow as the effect of the COVID-19. On the supply front, no significant issue reported to SSESSMENTS.COM.
Looking ahead, some market players opined to SSESSMENTS.COM that despite the rebound in crude oil prices, the room for PE prices to increase further is limited considering slow finished product demand. However, the rest believed that the PE market in India will gradually recover, which expected to support firm PE prices in the near term.
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NewsSSESSMENTS: Indian Producers Announced Adjustment On PE, PE Prices With Effect From June 1
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