China Morning Snapshot – 10 July 2018

Dalian Commodity Exchange started to gain some strength as September delivery contract for both PP and PE ended the morning session higher. PP futures gained CNY89/ton ($13/ton) to CNY9193/ton ($1201/ton without VAT) while LLDPE increased CNY55/ton ($8/ton) to CNY9205/ton ($1202/ton without VAT).

Spot market responded immediately to the recovery in the futures ground with homo-PP traded in Eastern China at CNY50/ton ($8/ton) higher day-on-day, reaching CNY9150-9250/ton ($1195-1208/ton without VAT), EXW China, cash equivalent.

Spot LLDPE film in Northern China stayed stable to CNY50/ton ($8/ton) firmer to CNY9250-9350/ton ($1208-1221/ton without VAT) with the same term.

Players are taking a step back to assess the impact of the recent hike in futures trading on the near-term outlook while keeping in mind the heightened trade tension between China and the USA. “Deals mostly take place at the lower end of the overall price range and buyers are not interested in volume. We are watching out for the sustainability of the current trend,” a trader informed.