China Morning Snapshot – 25 May 2018

There is apparently no breakthrough on Dalian Commodity Exchange on the final trading day of the week. September delivery contract for PP ended the first half of the trading day losing CNY7/ton ($1/ton) to CNY9190/ton ($1240/ton without VAT) while LLDPE decreased CNY20/ton ($3/ton) to CNY9235/ton ($1246/ton without VAT).

Both PP and LLDPE in local market stayed largely stable compared to the previous trading day, however, traders become more willing to offer additional discounts for serious buyers.

Spot LLDPE film in Northern China is reported at CNY9450-9600/ton ($1264-1284/ton without VAT) while spot homo-PP in Eastern China hold steady at CNY9100-9200/ton ($1217-1231/ton without VAT), EXW China, cash equivalent.

Total PP and PE inventories at Sinopec and CNPC’s warehouses pile up 3000 tons from the previous trading day to approximate 730,000 tons as of 25 May 2018, signalling a slow down in demand. Market sources have expressed a rather bearish expectation for the near term outlook, citing a number of plants would resume operation in the coming week after completed maintenance work and boost local supply further.