China Morning Snapshot: 20 March 2018

Dalian Commodity Exchange once again loses its momentum and soft landing by the end of the morning session. PP contract plunged CNY154/ton ($24/ton) to CNY8617/ton ($1164/ton without VAT) and LLDPE slid CNY155/ton ($24/ton) to CNY9185/ton ($1240/ton without VAT).

Spot demand is thin in Eastern China, and traders continue cutting homo-PP prices by CNY50-100/ton ($8-16/ton), bringing latest offers to CNY‎‎‎8500-8650/ton ($‎‎1148-1168/ton without VAT), EXW China, cash equivalent.

On the other hand, LLDPE film in Northern China remained largely stable in the range of CNY9100-9350/ton ($‎‎1229-1262/ton without VAT), with the same term.

Total PP and PE inventories at major domestic producers’ warehouses reduced 15,000 tons to approximate 980,000 tons as of 20 March 2018. Weak futures trading is hammering market confidence and coupled with reluctant buyers, many traders are now becoming very open to negotiation.

“We are not buying beyond the immediate need as finance is very tight at the moment. End product demand has yet to see any major pick up and we do hope to obtain larger cuts in the coming days,” a BOPP sheet maker reported.