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Import PE offers to China has inched higher since the previous week as overseas sellers managed to deplete a good quantity of inventories following three consecutive weeks of active buying in this market. Today, several overseas sellers continue lifting offers with additional support from the recent development in the Middle East.

On 14 September 2019, a series of drone attacks targeting Saudi Aramco’s most important oil processing facility and second-largest oil field have shut more than 5% of the global oil supply and forced a number of petrochemical plants to lower production rates in the face of lacking feedstocks.

Such development is expected to curtail PP and PE output in the near term despite the fact that it is uncertain on how long these petrochemical plants would take to resume regular run rates.

A major Thailand producer announced fresh weekly PE offers to China with increases of $20/ton on HDPE film to $945/ton and $30/ton on LLDPE film to $925/ton, all based on CFR China, LC AS term.

“The increases are too quickly and we are still concern over the sustainability of the current trend. We have procured some cargoes in the previous weeks and currently negotiating with local suppliers to replenish additional quantity,” a buyer reported.

Meanwhile, the producer portrays no urges to adjust offers to close deals citing the lack of inventories pressure.

In the meantime, players also see $30-40/ton hike in Indian LLDPE film on the first trading day of the week to $820/ton with the same term while LDPE film touches $900/ton. 

Another buyer reportedly received Singaporean metallocene PE (mPE) at $1190/ton CFR China, ups $50/ton week-on-week said, “The firming trend might sustain in the coming days, especially with the market preparing cargoes ahead of the long National Day holiday in October. However, we are very cautious about the post-holiday demand outlook, hence prefer to hold conservative stance.” 

In fact, there have been reports that Chinese players tend to source materials from the domestic market and near-by cargoes to avoid the potential price risks associated with the deep-seas parcels. The recent uptrend might not be smooth sailing as the trade war between China and the USA has yet to reach any agreement.      

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