In Europe, PE sellers could obtain €80-100/ton increases on November deals on the back of higher costs and supply constraints for some grades. Sellers have mostly trimmed their initial hike requests as increases surpassing the ethylene’s upsurge have proved unworkable amid slow purchasing activity.

Recent hikes have pushed prices in Italy and West Europe to their highest levels since around June-July, according to ChemOrbis Price Index data.

Some grades tighter than others

LLDPE, MDPE and HDPE grades have been reportedly tighter than other grades amid disrupted overseas supplies. A lack of sufficient imports from the US for mLLDPE C6 has pushed prices significantly higher. Some sources selling Middle Eastern material reported being sold out due to their trimmed allocations.

US PE back in the game, not necessarily at aggressive levels

Meanwhile, import US offers have re-emerged recently, with HDPE film being traded at €1610-1650/ton on DDP basis, with delivery in January. This was deemed as the reflection of growing supplies in the US.

Still, prices are at par with or close to the European levels and there are no signs of the market being awash with US material. Locally-held US PE cargoes also trade at par with the European origins.

Buyers sit on comfortable stocks

Despite tightness for some grades, the PE market did not absorb initial hikes beyond €100/ton. Overall buying appetite has been calm and remained tied to basic needs, with buyers feeling no urge to buy as they sit on comfortable stocks.

Converters did some pre-buying during October amid firmer voices, while some of them reported that they are still receiving previously secured cargoes amid delivery delays. A lack of truck drivers and lower cargo handling speed due to the lack of manpower at ports have been leading to longer than usual transit times.

That is to say, converters will be focusing more on the stock management, bearing in mind that demand will gradually slow down towards the year-end and logistical hurdles will prevail.

Skepticism about further hikes in Dec

Sellers voiced firmer expectations for December, citing rising costs and a lack of competitive import offers. Despite firmer voices, there remains uncertainty if buyers will be back to replenish heading towards year-end festivities.

Some players are skeptical about the absorbability of further hikes, considering comfortable regional availability, year-end lull as well as container freight rates that came off their peaks in September.

(Source: chemorbis)

In Vietnam, import PP prices have been rising for the past two weeks after a month-long stability. This has been in line with the bullishness in the China PP market amid the country’s energy cuts.

Lower import availability due to scarce arrivals, as well as stronger energy values have also been cited as other drivers of the market.

On top of that, the demand outlook in Vietnam has improved since the second half of September started amid hopes of easing Covid-19 restrictions, also contributing to the weekly gains.

The commercial hub Ho Chi Minh City will start lifting its coronavirus curbs as October kicks off, matching expectations.

Weaker economic data urged easing restrictions

Vietnam’s latest economic data explains why the government leaves the zero-Covid policy behind.

The country is taking steps to revive its economy by allowing more business and social activities although experts worry that it may be too early to do so considering the low vaccination rates in most of Southeast Asia.

According to data from Vietnam’s General Statistics Office (GSO), the country’s gross domestic product fell by 6.17% year-on-year in the third quarter, down from an increase of 6.57% in the second quarter.

PP prices up by around $20-45/ton from last week

The overall range for import homo-PP raffia and injection prices on CIF Vietnam basis has been assessed $20/ton higher from last week at $1200-1290/ton and $1220-1290/ton, respectively.

A few players said, “Import PP offers have firmed up by $20-30/ton on a weekly comparison. The number of import PP offers has remained limited. Meanwhile, we are still facing shipment issues. Freight rates are quite high and it is getting harder to find available ships nowadays.”

As for locals, homo-PP raffia prices were also up by VND300,000-1,000,000/ton ($13-44/ton) from last week to be assessed at VND31,800,000-33,500,000/ton ($1272-1340/ton without VAT) on FD Vietnam, cash basis.

A converter noted, “Local PP prices have slightly increased, following higher import prices. Demand has improved recently due to the expectations that the government will relax the Covid-19 curbs as of October in order to revive the economy which has been under pressure of partial lockdowns.”

(Source: Chemorbis)

In Africa, PP and PE offers for September were firmer as compared to August, largely as a result of diminished supplies from the Middle Eastern and Asian suppliers. Although demand was little changed from last month, the tight supply situation dictated the higher pricing across the regional markets.

No Saudi availability in Nigeria

The biggest polymer market in West Africa made a strong start to September, as a major Saudi supplier cut allocations to Nigeria by a large margin, citing their supply and logistics problems. Meanwhile, new offers for South Korean and Indian materials indicated large increases over August. “Korean supplier’s allocation is also quite limited,” a trader reported. “Limited supplies and higher freight rates fuelled sharp increases,” another trader said.

The latest import offers in Nigeria were at $1690-1710/ton for PPH raffia and inj., $1790-1800/ton for PPBC inj., $1900/ton for PPRC inj., and $1590-1600/ton for LLDPE C4 film, HDPE film, HDPE b/m, and HDPE inj., all on CFR Lagos, excluding 10% CD basis.

ELEME announces rollovers to increases

ELEME, Nigeria’s domestic producer, announced rollovers or NGN20,000/ton ($48/ton) increases for PE. For PP, some grades saw very small increases of around NGN400-700/ton. Demand remained disappointing, with buyers purchasing hand-to-mouth.

Accordingly, the latest local offers in Nigeria were at NGN1,012,500/ton ($2464/ton) for PPH raffia and inj., NGN1,079,000-1,084,000/ton ($2625-2638/ton) for PPBC inj., NGN790,000/ton ($1922/ton) for HDPE b/m, HDPE film, and HDPE inj., and NGN816,000/ton ($1985/ton) for LLDPE C4 film, all on ex-Port Harcourt City, cash not including 7.5% VAT.

Asian PP offers in Kenya surge

In Kenya, East Africa’s largest economy, a major Saudi producer’s new PE offers were higher by around $10-30/ton at $1340-1350/ton for HDPE film and LLDPE C4 film, and $1630-1670/ton for LDPE film, CFR Kenya, 90 days. The Saudi major’s PP offers also increased by a similar amount to be reported at $1440-1450/ton for PPH raffia and inj., with the same terms.

Meanwhile, PPH raffia and inj. offers for Chinese materials surged to $1700-1710/ton while South Korean materials were at $1680-1690/ton, largely due to record-high freight costs and an ongoing tightness in supplies.

“Supplies from the Middle East are limited and offers from China and India are very high due to increased freight rates,” a trader based in Nairobi said. The trader also said that they were expecting to see further increases over the near-term, largely due to the ongoing shipping issues and tight availability.

Saudi LDPE, LLDPE unavailable in Algeria

In Algeria, North Africa’s largest oil and gas producer, new HDPE film offers from a major Saudi producer increased by around $70-90/ton over August levels to $1450-1470/ton CFR Algeria while there was no availability for LDPE film and LLDPE C4 film.

The producer’s PP offers, meanwhile, were up by around $50-75/ton from levels in August to stand at $1500-1550/ton, with the same terms.

South Africa market follows suit despite low demand

South African markets saw rollovers to moderate increases ranging from $10/ton to $30/ton as compared to August levels. “Supplies from Saudi producers are very restricted this month and this is supporting the firm trend. But sales are disappointing and demand is still weak,” a trader in Durban said.

The September price range in South Africa was at $1320-1350/ton for HDPE film, $1570-1670/ton for LDPE film, and $1300-1350/ton for LLDPE C4 film, all on CFR Durban, 90 days basis.

(Source: chemorbis.com)

In Europe, players returned to a changing sentiment after summer holidays as prices for non-European origins have been revised upwards in tandem with rising shipping costs amid logistical mishaps. Suppliers from the Middle East, the US and Asia were seen lifting their offers to Europe as September kicked off.

Supply bottlenecks support hikes for import origins

Shipment issues from the Middle East and Asia amid container shortage curbed the import flow to the bloc, which in turn led to diminishing availability.

South Korean PPBC inj. was offered with increases at €1700/ton CIF Italy, 60 days 10 days ago. Meanwhile, a distributor reported hikes of around €100/ton for South Korean material with delivery in September, blaming sky-high freight rates from Asia. US mLLDPE C6 was dealt at €1450-1500/ton DDP Italy, 60 days, indicating €60/ton hikes for August. This is due for arrival in September-October, meanwhile.

Moreover, prices on the low ends faded from the spot market as non-European origins saw hikes in the past weeks. PE offers from Turkey and Central Eastern Europe were adjusted up, which erased some of their earlier losses. A buyer affirmed to have received Turkish LDPE offers above August levels.

Eyes on spillover impact from Hurricane Ida

Adding to the recovering sentiment emanating from lower import availability has been disrupted production at several petrochemical hubs in the US driven by Hurricane Ida. ExxonMobil, Pinnacle Polymers and DowDuPont’s downstream units were taken offline following the issue.

Heading towards the last quarter of 2021, US PE material will remain limited, as was the case during most of the year, amid robust domestic demand and logistical hurdles.

What will be the reflection on European origins?

Fresh September offers from regional sources were pending last week, with expectations centering on a stable to slightly firmer trend. Sellers aim to push for small hikes on tighter grades like LDPE, mLLDPE and PPBC, pointing to the difficulties to procure raw materials.

However, additional hikes may not be absorbed as Europe’s spot markets remain inflated, with buyers lamenting about restricted end orders in certain sectors. Some of them also did pre-buying during summer vacations, while regional PP supplies are expected to improve after lifting of the force majeures. Several players expect prices to move sideways, with firmer non-European prices and logistics issues hindering a possible drop in the short-run.

(Source: chemorbis.com)

After following a stable to slightly firmer trend since early June, import LDPE and HDPE film prices in China witnessed slight decreases during the week that ended on August 13 despite supply limitations from overseas markets, particularly from the Middle- East amid production issues in that region.

The worsening Covid-19 conditions in China and rising logistics costs kept demand slow while support from the cost side also weakened with lower ethylene prices in Asia, weighing on LDPE and HDPE film prices.

As for LLDPE film, prices managed to maintain their stability unlike other PE grades on relatively better demand amid higher food packaging usage during Covid-19 related lockdowns across major Chinese cities.

“While demand concerns persist over downstream markets’ recovery, LLDPE prices have been better supported. LLDPE interest has increased over the other grades as there is higher demand for food deliveries, especially during the recent Delta variant-triggered lockdowns and restrictions across many major Chinese cities. Around 80% of LLDPE goes into film applications such as in food and also non-food packaging,” noted a trader.

Elaborating further, he added, “However, the flip side of rising infections also means that factory production, transportation, and trading activities have been disrupted. Adding to Covid are the current floods across major Eastern and Southern provinces which also crimp activities.”

During the week that ended on August 13, overall import PE prices were assessed down by $10-20/ton from the previous week for LDPE film at $1280-1340/ton, down by $10/ton for HDPE film at $1070-1120/ton, and unchanged at $1070-1180/ton for LLDPE film, all on CIF China, cash basis.

(Source: Chemorbis)

In Africa, August offers from Middle Eastern suppliers indicated rollovers or moderate gains as compared to July levels in most regional markets. Although supplies were not ample, weakened demand conditions prevented sellers from seeking large hikes in August.

In Nigeria, a major Saudi supplier’s new offers for August indicated increases of $40-50/ton while LDPE offers were unchanged from their previous levels. Meanwhile, ELEME -Nigeria’s domestic producer- also announced rollovers for August.

“We are waiting to hear from Asian suppliers but they are unlikely to be competitive against their Middle Eastern counterparts,” a trader said, citing increased freight costs.

The trader also reported a log of pending orders from the major producer and said:

“Delayed shipments are affecting the supply levels in the market. Supplies are diminishing fast and this keeps prices firm despite the disappointing demand.”

Access to foreign currency was also reported to have been restricted in Nigeria. In late July, Nigeria’s central bank halted the sale of foreign exchange to money changers. The decision, which was aimed at easing pressure on the nation’s currency, halted the central bank’s supply of $5.72 billion annually.

In Kenya, a major Saudi producer’s new offers increased by $40-50/ton, with the exception of LDPE film grades, which remained stable from July levels. According to daha from ChemOrbis Price Index, this marked the first increase since May.

Players reported slower-than-normal market activities and dwindling end-product sales. “Supplies are not ample but they are enough to meet demand,” a trader said.

In South Africa, offers for Saudi LDPE film were stable from July while HDPE film and LLDPE C4 film offers increased by around $40/ton. The supply availability was largely balanced with demand. “Players are pushing for lower deals, largely due to slow activities,” a trader in Durban said.

In Algeria, sluggish demand overshadowed the fact of limited availability in the region. Accordingly, the latest offers for LDPE film and PPH grades were stable from last month while HDPE and LLDPE C4 film prices dropped by $20-70/ton.

“Activities are slow as buyers are limiting their purchases to immediate requirements,” a trader in Algiers said.

(Source: Chemorbis)