Print

Due to the effect from the financial market, both PP and PE futures on Dalian Commodity Exchange concluded the first half session today on skyrocketed note. Contract 1701 for PP surged CNY341/ton ($50/ton) while LLDPE leaped CNY22/ton ($32/ton). Players expected this trend might sustain throughout the final trading day of the week.

This has boosted the optimism expectation among local suppliers and in fact, couple of major producers suspended their offerings for both PP and PE, hoping to achieve larger hike in the coming week. A trader informed, “We lifted our spot PP and PE prices by CNY100/ton ($15/ton) earlier today, and at the moment we have withdrawn offers. Futures market mostly follow firming trend this week, and together with the lack of sales pressure, our principal supplier is planning for further hike.”

On the other hand, buyers are not showing much excitement about such move with a converter in Fujian said, “We have not placed any order for PP this week due to sufficient inventories on hand. Demand for our end product is rather stable, yet we prefer to take cautious stance and hold minimal stock. Firming futures prices might brighten the general sentiment, however, we are not positive on seller’s ability to translate this into significant spot price hike.”

The number of deals concluded in China has dropped visibly compared the earlier week, players said, yet market sources repeatedly claimed seeing very thin chances for PP and PE prices to speedy slide in the coming days. Most are looking at stable track for now.