China Morning Snapshot – 05 July 2018

Sentiment on Dalian Commodity Exchange started to wean towards the end of the week. September delivery contract for PP concluded the morning session losing CNY87/ton ($13/ton) from the previous day to CNY9166/ton ($1190/ton without VAT). Meanwhile, LLDPE contract inched CNY65/ton ($9.8/ton) lower to CNY9190/ton ($1193/ton without VAT).  

Weaker futures market immediately affected the sentiment in spot ground. Traders in Eastern China implement a reduction of up to CNY150/ton ($23/ton) on spot homo-PP cargoes, sending the latest offers to CNY9250-9400/ton ($1201-1220/ton without VAT) , EXW China, cash equivalent.

In Northern China, thanks to better sales results in the previous trading day, sellers here maintain prices mostly unchanged at CNY9100-9300/ton ($1181-1207/ton without VAT) with the same term.

Chinese buyers are monitoring the 6 July 2018 landmark as the USA and China are all set to impose 25 per cent tariffs on imports from each other. “Financial market is set to get hit and we only make small purchases this week,” a trader said.

Total PP and PE inventories at Sinopec and CNPC’s warehouses fell 35,000 tons day-on-day to approximate 655,000 tons as of 5 July 2018.