China Morning Snapshot – 27 April 2018

Dalian Commodity Exchange ended the fluctuated morning session on a mixed note. September delivery contract for PP inched CNY16/ton ($3/ton) higher to reach CNY8969/ton ($1209/ton without VAT). In contrast, LLDPE contract loses CNY10/ton ($2/ton) to reach CNY9270/ton ($1250/ton without VAT).   

Domestic spot market remains relatively calm though suppliers decided to implement CNY50/ton ($8/ton) increased on spot homo-PP cargoes, bringing latest offers to CNY8900-9000/ton ($1200-1213/ton without VAT), EXW China, cash equivalent.

Spot LLDPE film in Northern China holds steady in the range CNY9400-9600/ton ($1267-1294/ton without VAT) with the same payment and delivery term.  

In spite of the fact that total PP and PE inventories at Sinopec and CNPC fell 40,000 tons day on day to approximate 750,000 tons as of 27 April 2018, players are not acknowledging the demand condition, instead, pointing to suppliers’ effort in achieving the monthly target by pushing quantity to distribution market. However, sources are relatively optimistic about the near-term outlook, citing the lack of inventories pressure.