Metallocene market stable in Asia, high prices face resistance

It is reported that major Southeast Asian producers are maintaining metallocene PE (mPE) offers unchanged week on week to China and Indonesia, though buying interest is not as strong as expected. Buyers are portraying a generally more cautious stance toward fresh replenishment.

In Indonesia, mPE originated Singapore and Thailand stand at $1410/ton and $1450/ton respectively, all based on CIF Indonesia, LC AS term. A converter said, “We are having comfortable inventories till November and we are considering whether to make additional purchases. Prices seem to be reaching the peak and hence we are taking the passive stance of conservative.”

In China, Singaporean mPE holds stable at $1400/ton CFR China, LC AS term though offers are only available to converters. Traders might only receive new offers in the coming week. “We were informed that market might hold firm until National Day holiday. Prices are just too high and with regular PE grades are following the softening trend, we hope to obtain some discount in the near term,” a market source said.

Trading activities in China are expected to wind down in the coming week as players are embracing the long National Day holiday. However, suppliers seem to be determined to hold prices firm citing strong upstream costs. Market is on the tug of war and the state of pre-holiday replenishment condition would define the potential outlook in the near term.