China Morning Snapshot: 06 March 2018

May delivery PP and LLDPE futures extended weak trend throughout the morning session. PP contract loses CNY45/ton ($7/ton) to CNY9172/ton ($1236/ton without VAT) while LLDPE closed at CNY9490/ton ($1279/ton without VAT), a decrease of CNY105/ton ($17/ton).

Falling futures market has affected the sentiment in the spot ground. Traders have cuts offers for both PP and PE by up to CNY100/ton ($15/ton) from yesterday in order to attract buying interest.

Homo-PP offers in Eastern China stand in the range CNY‎‎‎9000-9150/ton ($‎‎1213-1234/ton without VAT), EXW China, cash equivalent.

LLDPE film offers in Northern China are reported at CNY9300-9500/ton ($‎‎1254-1281/ton without VAT), with the same term.

Suppliers continue hoping for better demand condition citing the low inventory levels at buyer’s side. However, buying interest is not improving as quickly as expected, resulting in bloated stock levels at trader’s side. “It is normal to have inventory pressure in the post holiday term, just that we weren’t expecting such slow recovery in demand,” a trader said.