Asian PE producers have been forced to agree to steep discounts from March done deal levels to achieve sales for April. As per Chemorbis, sell offers to the Chinese market failed to not attract much buying interest after agreeing to large discounts on initial April offers, forcing producers to concede to an additional round of decreases to conclude deals. LDPE film prices have posted the steepest declines of any PE product recently as increasing substitution by LLDPE film has led to a significant drop-off in demand.
In Southeast Asia, regional producers have only recently announced their new offers for April, but several have already indicated willingness to agree to extra discounts in case of firm bids. In China, a Thai producer reported to sell off most April allocation this week with discounts of US$40/ton for LLDPE film and US$50/ton for HDPE film when compared with their initial offer levels, announced in the previous week with decreases of US$35/ton for HDPE film and US$65/ton for LLDPE film when compared with late March offer levels. A Taiwanese producer, who had reduced offers for HDPE and LLDPE film by US$70/ton in late March, has agreed to further price reductions of US$55/ton for HDPE film and US$75/ton for LLDPE film on April offers to speed up sales, as well as beginning to seek out alternative markets to counter the poor demand in China. Another Southeast Asian producer entered the market with initial April offers this week, cutting HDPE film prices by US$90/ton and LDPE film offers by US$150/ton from March. A major Middle Eastern producer stated that they managed to conclude a few deals for April LDPE film this week with US$170/ton decreases when compared to their March done deal levels.
The downward trend in China’s PE market has had a noticeable impact in near-by Southeast Asia, which has seen demand for mainstream origins driven downward by a large number of offers for ex-China re-exports. Buyers in the region have also reacted to the downward slide in Chinese PE markets by retreating to the sidelines in hopes of further decreases, with most reporting that they intend to negotiate for further decreases. One Southeast Asian producer announced April offers to the region this week with decreases of US$40-70/ton for LDPE film, US$80/ton for LLDPE film and US$100/ton for HDPE film, with the producer commenting that they are willing to discuss further discounts with serious buyers. Another Southeast Asian producer also announced initial April LDPE film offers this week with a US$50/ton decrease from their most recent March offer levels, pointing to lackluster demand. In addition, a major Thai producer announced April offers for HDPE film this week with decreases of US$50-60/ton when compared with their late March offer levels.