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The long National Day holiday in China is just around the corner and it appears that buyers in the country have made sufficient pre-holiday replenishment. Trading activities in domestic spot PP and PE market are diminishing visibly as a result, and muted condition might emerge in the coming days.

Many deals concluded this week in local ground are scheduled for delivery after the National Day holiday, “Because it is hard to arrange any logistic at the moment. Buyers are no longer active by the week’s end and we started to leave office too,” a Shanghai based trader commented.

However, players are generally holding optimistic expectation for the post holiday market outlook, considering the low inventories levels on both suppliers and buyers’ hands. Private data showed that PP and PE inventories at major local producers’ warehouses digested another 30,000 tons from the previous day, to 620,000 tons as of 28 September 2017. As reported earlier, local inventories are estimated to rise about 200,000 tons throughout the holidays, and together with the current stock, sellers are clearly free from any major sales pressure.

A trader added, “We also believed that buyers would need to make additional replenishment by second week of October and this appears to be a good signs for the market.”

In fact, a number of large scale converters in the packaging and daily product sector elected to take only four days off for the holiday given high number of end product orders. “And we might need to make purchases continuously as we are only having inventories until late October,” a BOPP sheet maker said.

Suppliers are also hoping that demand would remain healthy in October in line with the traditional high demand season from the agricultural film sector as well as the aggressive preparation for the Single Day sales.