Information
| PP/PE/PS/PVC PRICES ASIA June 22nd,2009 |
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Written by bod010
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Tuesday, 04 August 2009 11:34
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Crude oil prices declined on Friday on indications that motor fuel supplies were likely to increase in the US due to gains in crude production by refineries. Crude oil prices turned bearish as a report by the US Energy Department on June 17 stated that there was a rise in gasoline inventories by 3.39 million barrels to 205 million the week before, the biggest rise since January. The total daily demand for fuel has declined by 6 percent as compared to a year ago. The Energy Department also informed that in the week ended June 12, 9.13 million barrels of gasoline per day were produced by US refineries, an increase of 2 percent from the week before. Refinery operations were pegged at 85.9 percent of production capacity last week, an increase from 80.4 percent of production capacity in the week ended April 10. There was a rise in gasoline imports by 25 percent to 1.09 million barrels per day last week, the highest rise since April. An International Energy Agency report dated June 11 stated that global demand for oil is slated to fall 2.9 percent this year to an average 83.3 million barrels per day. The report also said that oil consumption in the US, the world’s largest oil consumer, will decline by 4.9 percent to 18.55 million barrels per day. Nymex crude futures decreased to trade at USD 69.55/barrel while Dated Brent spot prices fell to trade at USD 68.30/barrel. WTI Cushing spot prices turned lower to trade at USD 69.55/barrel.Polyethylene
On Friday last week, FOB Korea prices were assessed sharply up at the USD 885/mt levels while CFR South East Asia prices were assessed up at the USD 870/mt levels. Short covering by traders coupled with active buying interest from derivative producers of PE, supported ethylene sellers in their quest to steer their prices higher. Reports that South Korea’s YNCC had shut its 550 kt/annum, No.2 cracker briefly also helped keep the pricing undertone bullish. A supply crunch from Iran further supported pricing strength in ethylene values across Asia. Sellers have tested the markets with notional offers for ethylene at the USD 900/mt CFR mark and PE producers are willing to pay this price given their healthy margins of more than USD 200/mt. Bids from other end users including producers of MEG are much lower, however this is of little concern as for now there is ample demand for ethylene from traders and from PE producers. In the PE markets meanwhile, HDPE film prices last Friday were assessed at the USD 1275/mt CFR Far East Asia mark while LDPE prices were assessed at the USD 1220/mt CFR Far East Asia levels. LLDPE prices were assessed at the USD 1205/mt CFR Far East Asia mark while PP raffia and PP injection prices were assessed at the USD 1110/mt CFR Far East Asia levels. MEG prices were assessed up last week at the USD 590/mt CFR China levels.HDPE PRICES GALLOP HIGHER IN ASIAActive buying interest coupled with strength in upstream product prices including those of crude, naphtha and ethylene feedstock, supported Asian sellers in their efforts to steer their offer prices of HDPE higher last week. HDPE film prices were assessed up at the USD 1270/mt CFR Far East Asia basis while CFR South East Asia prices were also assessed up at the USD 1270/mt levels. CFR South Asia prices were assessed up at the USD 1285/mt to USD 1295/mt levels. HDPE yarn prices were assessed up last week at the USD 1250/mt CFR Far East Asia basis and USD 1260/mt CFR South East Asia basis on the back of strength in regional buying activity. In China, domestic demand for PE was said to be robust prompting producers to up adjust their list prices. PE is needed in many areas. A few plastic mesh products contain PE, for example, barrier fencing mesh and deer mesh fencing. Sinopec is reported to have hiked its ex factory prices of HDPE film by RMB 150/mt and its HDPE injection moulding prices by RMB 200/mt levels. In production news, construction work on SHARQ’s new 400 kt/annum HDPE plant located at Al Jubail is said to be almost 90% complete. Petlin from Malaysia meanwhile is expected to bring its HDPE/ LLDPE plant online end June as a maintenance turnaround at the 250,000 mt/annum plant is scheduled to be completed by then.LDPE PRICES EDGE UP CONVINCINGLY IN ASIALDPE prices firmed in Asia last week. Prices gained not only on the back of higher ethylene feedstock prices accompanied by bullish crude and naphtha values, but also on account of good regional buying interest and tight product availability. General purpose LDPE prices last week were assessed up at the USD 1210/mt CFR Far East Asia and CFR South East Asia levels. For July, LDPE offers were heard higher at the USD 1250/mt CFR levels. In China, Sinopec Corp reportedly hiked its ex-factory LDPE price by RMB 300/mt. The revised price was now pegged at the RMB 10000/mt to RMB 10100/mt levels. In plant news, Petlin was due to restart its LDPE plant at Kertih end June. A maintenance turnaround at the 255,000 mt/annum plant was due to be completed as scheduled.LLDPE PRICES IN ASIA GALLOP HIGHERLLDPE prices galloped higher in Asia last week. CFR Far East Asia prices of LLDPE were assessed up at the USD 1200/mt levels while CFR South East Asia prices were assessed at the USD 1200/mt to USD 1210/mt levels. CFR South Asia prices of LLDPE were assessed at the USD 1225/mt to USD 1235/mt levels with sellers eyeing a further price hike on account of tight regional product availability coupled with strength in upstream product costs including those of crude, naphtha and ethylene. Producer production margins are currently very lucrative given the steady and sustained climb in PE prices and therefore there remains some flexibility in negotiations with customers. However, the flexibility is limited given the tightness in regional product availability. Producers therefore are focusing their sights on higher offers while if demand shows signs of waning, they will offer some discounts.” For now, demand is robust hence price offers for July are up at the USD 1240/mt CFR China and CFR South East Asia levels. In China, Sinopec is reported to have hiked its ex factory offers for LLDPE by RMB 200/mt last week.Polypropylene
Regional propylene availability was limited and buyers feared additional tightness going forward as oil refineries especially those in Japan were heard to have cut their crude runs due to poor margins. This would limit naphtha availability and eventually limit propylene production. Supporting the price spike in propylene were gains recorded in the downstream PP markets across Asia. PP raffia and PP injection prices were assessed up last Friday at the USD 1110/mt CFR Far East Asia levels. Encouraged by these bullish triggers, traders were seen active in their attempts to build long positions. On Monday morning, pricing trends continued to remain bullish with propylene offers to China heard up at the USD 960/mt to USD 970/mt CFR levels.PP PRICES BOLSTER HIGHER IN ASIAAsian PP prices edged higher last week, gaining in tandem with strength in crude, naphtha and propylene feedstock rates. Demand for spot cargoes remained quite robust in many parts of the region, supporting sellers in their efforts to hike their offer rates. PP raffia and PP injection moulding prices were assessed up at the USD 1100/mt CFR Far East Asia and CFR South East Asia basis with CFR South Asia prices assessed at the USD 1130/mt levels. July offers were heard firmer at the USD 1150/mt CFR South Asia levels with a leading Indian resin producer heard to have sold out its export quantities even for July. PP film prices meanwhile were assessed up at the USD 1160/mt CFR Far East Asia and CFR South East Asia basis with CFR South Asia prices assessed at the SUD 1180/mt mark. July offers for PP film for South Asia were up at above the USD 1200/mt CFR levels. In China too PP prices were on the rise with Sinopec reported to have hiked its raffia and injection prices by RMB 200/mt. PP copolymer prices were increased by RMB 400/mt levels. Meanwhile, PP importers in India were left stunned last week owing to an announcement by the Indian government regarding recommendations for anti-dumping duties on PP imports from select countries including Singapore, Oman and Saudi Arabia. Most PP importers polled, labeled the investigations as biased and the recommended anti dumping duty levies as ‘unfair’. PetroRabigh meanwhile was expected to start up its PP plant next month and would deliver its first ever PP cargo to China in August.IMPROVED BUYING MOOD NOTICED IN CHINA’S PP MARKETBullish sentiments were seen descending on the PP markets across China as traders and actual users grew calmer on the back of gains in global crude rates coupled with a rise in propylene feedstock rates across Asia, which is good news for PP products’ manufacturers. Window screen, plastic net bags and protective sleeve are all PP products. In Shanghai City in eastern China there was a lack of PP avails from petrochemical producers. Sellers pegged their PP yarn grade T30S offers at RMB 9750/mt. The offers for imported PP were hiked yesterday with deep-sea yarn grade offers at RMB 9500/mt. Supply was thin in the PP market of Hangzhou City in Zhejiang province of eastern China. PP yarn grade T30S was on offer at RMB 9750-9800/mt (cargoes to be picked up by buyers themselves). Transaction volumes at high prices were however scarce. In Xiamen City of Fujian province, the market prices for PP were steady. Chemasia reported that PP yarn grade T30S was priced at RMB 9650-9700/mt.Polystyrene
The week before last, there were worries about tight SM availability in the region. Late last week, these concerns diminished as many actual users covered up requirements until July. Since many processors in China are now well stocked with SM, there is no urgency to purchase material hence there is downward pressure on regional SM prices. Moreover, Shanghai Secco is expected to restart production mid of next month which will help supplies lift. Also term shipments from an SM plant in Kuwait are expected in July. In the domestic markets of China, prices of SM have declined with ex tank rates on Friday down at the RMB 8300/mt levels, a fall of RMB 100/mt to RMB 150/mt from Thursday’s levels.PS PRICES UP IN CHINAThe Ningbo subsidiary of Taiwan’s Formosa Chemicals and Fibre Corporation (FCFC) revised its offers for PS. GPPS 5250 and HIPS 8250 offer prices were at RMB 10300/mt and RMB 11300/mt respectively. Inventories were said to be relatively low. Zhenjiang Chi Mei Chemical Co., Ltd. meanwhile started up its PS plant, which was now operating normally. Its open ex-work offers were kept steady. GPPS PG33 and HIPS PH88 were quoted at RMB 9500/mt and RMB 10500/mt respectively. Supply of spot cargoes from the company were tight. On the market side, prices were higher, up in tandem with gains in PS prices in the rest of Asia, coupled with good domestic demand. Market prices for second-class GPPS were at RMB 9400-9500/mt.Poly Vinyl Chloride
VCM prices were assessed at the USD 710/mt CFR Far East Asia and CFR South East Asia levels. Supporting the strength in prices were firm crude and naphtha values coupled with bullish prices of ethylene feedstock. Also supporting stronger rates were gains recorded in downstream PVC. Higher PVC prices prompted VCM buyers across Asia this week to up adjust their bids in an effort to match up to seller offers. PVC prices were assessed up this week at the USD 850/mt CFR Asia mark.PVC PRICES IN ASIA PEGGED FIRMPVC prices across Asia this week bounced higher. While CFR China prices were assessed up at the USD 850/mt levels, CFR South East Asia prices were assessed at the USD 840/mt to USD 850/mt levels. To India, PVC offers were up at the USD 890/mt to USD 900/mt CIF Nhava Sheva levels with a July deal sealed this week at the USD 880/mt CIF Nhava Sheva mark. Demand currently for PVC across Asia remains quite robust. Exhausted inventories are being replenished by end users while traders sitting on low stocks are also in the markets with their inquiries as they expect PVC prices to remain firm going forward. Demand for Asian material is strong in Turkey too with a South Korean producer heard to have sold a July parcel at the USD 900/mt CFR Istanbul mark. Buyers accept that July will see PVC prices quote firm across Asia. Howeve, August will witness a slowdown, to start with in India, where the monsoon season will be well underway. Moreover in the Middle East region and the Muslim countries the buying pace in PVC will also slow with the start of the Ramadan month starting late August.Acrylonitrile Butadiene Styrene
Taders in the PE market of Shanghai City in eastern China followed trends and liquidated stocks, unaffected by the price hikes announced by Chinese domestic petrochemical producers last week. The offers for imported PE materials showed signs of modest decline. LLDPE 218W, HDPE B53 and HDPE 52518 were on offer at RMB 10100/mt, RMB 10250/mt and RMB 9750/mt respectively. On Tuesday morning, the mood turned further bearish following an overnight drop in global crude prices. At Qilu Chemical City, the market offers for PE edged down, with transactions reported to be sluggish. Chemasia reported that trading houses focused on liquidation of their stocks actively. The market offers for LDPE TN26, LLDPE 7042 and HDPE 6098 were at RMB 9950/mt, RMB 9780-9800/mt and RMB 11300-11350/mt respectively.
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