Steadily declining import LDPE film prices in the Chinese market have brought down premium for LDPE over HDPE film to its lowest level since the closing weeks of 2009, as per ChemOrbis. HDPE film prices have posted relatively smaller decreases as compared to LDPE or LLDPE film prices over the past several weeks, as HDPE supply has not been as loose in the country. Chinese traders had built up some LDPE and LLDPE film stocks in August and September in anticipation of the high season for agricultural film and found themselves overstocked for these products given generally disappointing post-holiday demand from Chinese buyers.
From October 2010 to mid-April 2011, spot LDPE film imports carried a premium of at least US$200/ton over spot HDPE film imports on a CFR China, cash basis. The highest premium recorded for LDPE over HDPE film for the past year was seen in late December 2010 at slightly more than US$280/ton. The premium for LDPE film over HDPE film briefly returned to the US$200/ton threshold in late May and continued to remain between US$100-200/ton from the start of June to the end of September and the onset of the National Day holidays.
In the weeks since the holidays, the premium for LDPE film over HDPE has sunk below the US$100/ton threshold for the first time since late December 2009. The premium sunk as low as US$60/ton last week before moving back up to around US$80/ton this week.