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Players report that there has not been much trading activity in Southeast Asia’s PP and PE markets this week as most buyers have elected to remain on the sidelines in hopes of seeing more attractive prices in the weeks ahead. A major rally in the Chinese polymer markets over the first half of the month pushed spot PP and PE prices higher in Southeast Asia as sellers unable to get prices similar to the prevailing offer levels inside China could easily divert their cargoes to the Chinese market instead. Over the past month, import prices on a CIF SEA, cash equivalent basis have posted increases of $80-125/ton for homo-PP injection and raffia, $50-60/ton for LLDPE film, $80/ton for LDPE film and $20-30/ton for HDPE film.

Over the past two weeks, as the tide has turned in China following the announcement of further government efforts to fight inflation, sentiment has also begun to cool off in Southeast Asia, especially as demand within the region had not been especially good to begin with. While sellers in the region are attempting to limit the size of the current price decreases by pointing to tight supplies, most buyers say that they are prepared to remain sidelined from the market until they see some more significant price concessions, with converters generally adding that they are feeling comfortable with their stock levels these days.

Two woven bag manufacturers in Indonesia stated that they are not planning to make any fresh purchases until they see some steeper discounts emerging in the import market. The converters both said that they have enough material to cover their needs until January while bolstering their case for lower prices by pointing to declining spot propylene prices in Asia. A distributor in Thailand reported that they are only interested in doing back to back business these days as most buyers are unwilling to purchase at the current price levels, with the distributor adding that they expect to see further price reductions over the near term.

A distributor offering locally-held import LLDPE film in Vietnam complained that they are not seeing much buying interest this week in spite of the fact that they conceded to price cuts of $47-106/ton on their offers this week. Although locally-held LLDPE film is in short supply in Vietnam, the distributor added that they are still having trouble attracting buyers as the ongoing depreciation of the Vietnamese dong against the US dollar as well as difficulties securing credit from the country’s banks are keeping most buyers out of the market for now. A plastic bag manufacturer in Malaysia stated that they are planning to wait until next month before making any fresh purchases in spite of the steep price declines of MYR94-199/ton ($30-64/ton) for LDPE film, MYR148-418/ton ($47-134/ton) for LLDPE film and MYR52-182/ton ($17-58/ton) for HDPE film observed in the local market this week.


information from chemorbis
 
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