Middle Eastern PE offers at a premium in Egypt

Middle Eastern producers announced their PE prices to Egypt while overall offer levels indicate decreases from their June levels, as per Chemorbis. Middle Eastern LDPE offers represent US$10-40/ton decreases from June while HDPE is US$30-80/ton lower and LLDPE is down by US$40-80/ton compared to last month. Despite these decreases, offers to Egypt from the Middle East carry a significant premium when compared with the current offers to China from the region, which also indicate decreases from last month. Middle Eastern producers’ offers to Egypt carry a US$200-250/ton premium for LDPE, US$115-185/ton for LLDPE and US$165-235/ton for HDPE film when compared to the offers in China from the same producers, since the freight rates are similar to both countries from the Middle East. Egyptian buyers complain about the Middle Eastern producers’ new offer levels despite the decreases they issued. Buyers express their discontentment especially for HDPE film as they view confidence that producers can offer further discounts at the time of purchase when considering the poor market sentiment. Despite some improvements witnessed on end demand, especially for film products ahead of upcoming Ramadan, buyers generally complain about their businesses, highlighting that this situation coupled with the still high prices discourage them from committing to import cargoes. Domestic producer SIDPEC revealed new July prices ahead of an upcoming maintenance shutdown, which will start in H2-July and will take around two to three weeks. Reportedly, the producer has already started to lower operating rates. SIDPEC elected to rollover offers for HDPE film, blow moulding and high MI injection while a source from the company noted that they have sufficient availability to meet the market’s needs in July for film and blow moulding grades. Meanwhile, they opted to lift their low MI HDPE injection offers by EGP500/ton (US$88/ton). This increase is due to the availability issues in the market for HDPE injection grades while some players claim that the producer does not deliver HDPE injection to the market. However, the producer did not confirm this information. In Egypt, buyers have been crying tight availability for HDPE injection grades for some time. The supply issues first introduced themselves with the lack of high MI HDPE injection and then it had started to be felt for low MI grades. Nowadays, the intensity of this tight availability has somewhat eased down although the injection market is still not as comfortable as HDPE film and blow moulding.
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