PE prices in China’s
local and import markets have seen slight decreases this week due
to weak demand and high inventories,
reversing course following a more than three-month uptrend.
Notably,
import LDPE and HDPE prices have witnessed downward corrections for the first time since December 2023.
According to ChemOrbis Price Index data,
import LDPE film prices have edged lower from their highest level in a year,
while HDPE film has slipped from the highest point observed since October 2023.
Meanwhile, LLDPE C4 film’s faltering started earlier last week, with import prices dropping from their one-year high.
For the week ending on March 15,
the overall ranges for PE film prices were assessed stable to $10-20/ton lower from the previous week at $1020-1100/ton for LDPE,
$950-1050/ton for HDPE, and at $930-1010/ton for LLDPE, all on CIF China, cash basis.
In the local markets, prices for all three film grades posted decreases,
marking a reversal from the upward trend observed over the past couple of months.
Players have reported that prices have been adjusted downwards,
largely because converters have been facing challenges coping with recent price hikes.
The uptick in demand observed over the last couple of weeks due to the stock replenishment activities at downstream factories has waned again.
Players have also pointed out that converters have been unable to pass higher costs to their buyers.
“While downstream operations have been gradually resuming,
the market demand has not improved enough yet,
leaving ample room for negotiation in actual transactions,” opined a trader.
A distributor of a Saudi Arabian producer reported that the producer’s LDPE film prices were down
by $5-10/ton from last week to stand at $1030-1070/ton, HDPE film prices were $10/ton lower at $960-980/ton,
and LLDPE C4 film were down by $10/ton at $960-980/ton, all on CIF China, cash basis.
“Imported materials are experiencing lower demand compared to domestic products,
although recently even local demand has diminished.
Thus, domestic supply is likely to lengthen. Converters maintain a cautious outlook,
given the lower downstream operations,
slow pace of destocking, and the mismatch of finished product prices and the hikes in raw material prices,”
a downstream player commented. A domestic PE producer’s distributor pointed out that converters couldn’t
pass on higher costs to their buyers, who also encountered a slower demand and lower prices for their finished products.
“Producers tried to reflect their escalating production and freight costs to converters.
However, there was a lack of support from the converters’ side.
We expect that prices will be trading at current or slightly lower levels in the near term,” he added.
