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Domestic PP and PE market in China has been wheeling the downtrend since January 2018 on the back of swelling supply and diminishing demand. Compared to late January, the average prices for PP and PE based on EXW China, excluding VAT has fallen approximate $125-130/ton for HDPE film and homo-PP and $75/ton for LLDPE film, CommoPlast data showed.

However, the market started gaining stabilization last week on renewed purchasing interest among buyers. The momentums continue to endure this week, which many traders claimed seeing the best trading day since returning from Lunar New Year just when the week begins. As a result, players strongly believed that market has risen above the cyclical bottom and might well remain on the stable to firmer track in the near term.

“Sales have been satisfactory over the past six sessions, from which we managed to deplete a considerable amount of inventories. We are now looking to make fresh replenishment while hoping the current condition persists,” a trader said.

Total PP and PE inventories at major domestic producers’ warehouses rose 90,000 tons over the weekend to 920,000 tons as of 2 April 2018. In spite of bloating stock, the market remains resilient. “We are limited offered quantity to the market as sentiment is recovering. Prices might be higher day-by-day this week,” a local producer added.

The main question that players are posting is whether the current condition would sustain after the long weekend holiday ahead. “We feel optimistic given that overseas suppliers started to take a firmer stance on the offers. Just yet, we are not expecting any drastic increases,” a trader informed.