Prices for LDPE and LLDPE film have begun to lose some ground over the past few weeks in Asia as concerns about possible monetary tightening measures inside China have pressured sellers to agree to some discounts to move material, especially as prices for LDPE and LLDPE film had posted relatively large increases during the preceding rising trend, as per Chemorbis. According to data from ChemOrbis Price Wizard, spot prices on a CIF SEA, cash equivalent basis lost US$22/ton for LDPE film and US$48/ton for LLDPE film from their mid-November high points to the end of last week.
A Southeast Asian producer is reported to have sold out most of their December allocation for LDPE film to the regional markets at prices US$20-50/ton below their initial offer levels for the month, conceding to these price reductions as their initial offers failed to meet with much interest from buyers. Largest discounts were given in the Vietnamese market as demand from Vietnam is relatively weaker than demand in other country within the region. A global producer reported to have concluded some deals for Middle Eastern LLDPE film with discounts of US$10-20/ton from their initial offer levels for the month, to overcome buyers’ resistance.
Inside the region, an Indonesian producer began the week by announcing a US$50/ton reduction on offers for LLDPE film, pointing to lower prices in the import market as the main reason for their price reductions. Meanwhile, distributors in Vietnam have slashed offers for locally-held LLDPE film by US$132-141/ton in hopes of spurring greater buying interest, adding that they are struggling to secure deals despite of the fact that most locally-held import material has already been re-exported to other markets such as Myanmar and China. While sellers have been pressured to agree to price reductions to speed up sales, currently, most sellers are not planning to concede to any major price decreases, given firmer upstream costs as well as relatively limited availability. Spot ethylene prices on a CFR SEA basis have gained US$30/ton since the start of the month while crude oil and naphtha prices are also hovering at high levels. In addition, some concerns have arisen that supplies may begin to tighten once more on news that ExxonMobil has had to shut its 600,000 tpa PE plant in Singapore due to mechanical issues at the plant.
14-Dec-10 
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