Import PE Prices To Vietnam Sturdy On The Back Of Supply Factor, Expected To Persist
- Supply issues served as a firmer footing for import PE prices
- State of demand for PE resins affected by the sales for end-products
- Players foresee sustainability of current price trend
On the week starting June 1, import PE prices to the Vietnam market remain sturdy on the back of supply factors. In the import market, SSESSMENTS.COM noted that import offers for HDPE Film, LDPE Film and LLDPE Film C4 from the leading Saudi polyolefins producer captured at a stable level from a week earlier. Similarly, a Kuwaiti producer also decided to maintain their offers firm for LLDPE Film C4 cargoes at $820/ton. Some market players further stated that the reason behind the firm prices from both producers is because of the limited availability of materials. To date, some converters managed to close deals with the leading Saudi polyolefins producer for LLDPE Film C4 cargoes at $840/ton, or $20/ton lower than the initial offer level. Additionally, import offers for HDPE Pipe (PE 100) of Thailand and Saudi origin surfaced with an increase of $20/ton from last month’s level, both currently standing at $950/ton. All offers are on LC at sight, CIF Vietnam Main Port basis.
In the local market, some traders informed that offers for localized Saudi HDPE Film cargoes were increased further this week, yet, they are unsure about the exact price changes. At the moment, the localized Saudi HDPE Film offers are ranging between VND22,300,000-23,300,000/ton ($955-998/ton) on cash, FD Vietnam basis and including 10% VAT. On the other side, a local trader reported to SSESSMENTS.COM that the company has sold out all allocation for PE last week and now the trader is only offering localized US LLDPE Film C4 cargoes at VND24,500,000/ton ($1,049/ton) on cash, FD Vietnam basis and including 10% VAT.
Demand-wise, SSESSMENTS.COM was told that the overall Vietnam PE market this week remains bearish. Citing that weak buying sentiment for PE resins is in-line with sluggish demand for finished products. Meanwhile, some traders who managed to sell out all allocation are not because of strong demand but limited allocation from the suppliers. On the production sector, due to slow sales for end-products, most converters are currently running at a reduced rate of around 40-50% from normal capacity. On the supply side, no significant issues reported at the moment.
Looking ahead, Vietnamese market players contacted by SSESSMENTS.COM believe that import PE prices will remain on an upward trend in the near term considering the higher ethylene prices. In terms of demand, no sign of improvement is observed so far.
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