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The overall supply condition for HDPE film across Southeast Asia has been relatively tight over the past months as suppliers put heavy attention on gaining better margins in China market. Overseas sellers are showing no hesitation in keeping firm stance on the cargoes, yet most domestic markets within the region are catching up in much slower pace.

This week, players in both Indonesia and Vietnam reported witnessing larger hike in local offers for HDPE film with limited quantity available. In fact, Indonesian traders implemented IDR400,000/ton ($30/ton) increased for this grade with 30 days term payment offers reaching IDR18,200,000-18,400,000/ton ($1345-1360/ton) without VAT, FD Indonesia. Buyers are showing resistance citing the inability to transfer higher costs to end product prices. A trader added, “We are not having ready material at the moment, leading to a possibility of further hike in the coming days. Supply is very tight and market might need to wait for PT. Lotte Chemical Titan Nusantara to normalize production rate before the tightness could be eased.”

In Vietnam, buyers are seeing locally held HDPE film cargoes jumped VND1,000,000/ton ($44/ton) week on week to reach VND32,500,000/ton ($1300/ton without VAT), FD Vietnam, cash term. The upper end of the market hit VND33,500,000/ton ($1340/ton without VAT) with the same term. “We only source hand to mouth basis as prices have increased too high, squeezing our profit margins. End product business is regular due to the festive season orders. We are planning to change the production formula to reduced the proportion of HDPE film used,” a HDPE bag manufacturer informed.

With the increases, buyers are taking more cautious stance in making fresh buy and a Vietnamese trader said, “We only can sell small quantity at higher price levels. The tightness condition might persist throughout this year, hence we are in no rush to deplete inventories.”