China Morning Snapshot - 27 August 2018

January delivery contract for both PP and LLDPE on Dalian Commodity Exchange fell into the red zone on the first trading hours of the week. The correction on the futures ground is causing heavy price cut in spot homo-PP market over the past sessions.

Details on the spot and futures prices are shown in the following table:

Total inventories at Sinopec and CNPC’s warehouses piled up 100,000 tons from last Friday to 835,000 tons as on 27 August 2018.

Buyers are in the wait-and-see position, hoping to see more discounts to emerge following the latest development in the futures market. “It was very slow this morning. Our customers showed little interest in placing any bids after receiving new offers,” a trader commented.

Market participants are expecting more price adjustment to take place in the next one to two trading days ahead of the month-end closing at producers’ side. “Cargoes will be pushed to traders and September will be the month to prove if demand would return strongly,” a source added.