Local PP and PE market in Vietnam strengthens on firm regional trend

Local PP and PE market in Vietnam strengthens on firm regional trend

A tremendous amount of effort that traders in Vietnam pour in to push local PP and PE prices has started to show results. On the final trading day of the week, domestic offers for the mentioned grades are seen at VND300,000-400,000/ton ($13-18/ton) higher, though buyers seem shied to make large purchases.

At the time this report is published, domestic offers are prevailed at

VND29,600,000-30,800,000/ton ($1180-1228/ton without  VAT) for LLDPE film
VND34,000,000-34,500,000/ton ($1356-1376/ton without VAT) for HDPE film
VND31,000,000-32,000,000/ton ($1236-1276/ton without VAT) for LDPE film
VND32,400,000-33,000,000/ton ($1292-1316/ton without VAT) for homo-PP

All based on FD Vietnam, cash equivalent.

A local trader informed, “Most of the cargoes arrived recently were purchased at higher costs and we have no choice but to increase selling prices to protect the profit margin. Looking ahead, import market might gradually firm up amid stronger upstream costs and improved demand in China.”

The recent escalated political tension in the Middle East has pushed energy complex to multi-months high levels and influenced the sentiment in the petrochemical sector. “However, at the moment, buyers tend to only check on prices with very limited actual transaction. Local inventories are high and we remain doubtful about the sustainability of the trend,” another trader added.

April to June period is usually the off-peak season for Vietnamese converters, from which many are reluctant to keep high inventories, though very active in asking for latest prices. “We have comfortable stock until the end of May, and therefore, we are in no rush to make any fresh buy at the current market condition. We strongly believed that market has little support to endure any drastic increases in the near term,” a woven bag maker commented.