Middle Eastern players voice softer December outlook

Players in the markets of Middle East including Saudi Arabia, Jordan, Lebanon and the United Arab Emirates had received lower November import as well as domestic prices, as per ChemOrbis. Currently, players have started to express their expectations of additional decreases and some have even started to voice their December outlook. A Saudi trader referred to their December outlook by saying, “Saudi Arabian offer levels are decreasing at a faster pace in Turkey than they are in Saudi Arabia. This situation sparks further decrease expectations in our market for December. Plus, overall supply levels are sufficient and buyers mostly shy away from the market or are limiting their purchases ahead of the upcoming book closures at the end of the year. However, December decrease expectations do not pass beyond US$20-30/ton.” Saudi Arabian players had received US$50-90/ton decreases for PE and US$70/ton drops for PP from a major domestic producer for November. In Jordan, a film and injection products converter is said to be holding sufficient stocks and therefore, not planning to make any fresh purchases. “Despite the fact that one of the Middle Eastern producers did not have quotas for November to Jordan, weak demand and sufficient supplies sitting at most players’ warehouses continue to prompt further decrease expectations into December. The weak market outlook causes demand to slow down further and sufficient supplies do not support any rebound over the near term,” he further added. “Our end business mainly targets Iraq, and due to the political tension there, our trade has been affected negatively,” said another converter, highlighting the weak market conditions. Middle Eastern producers’ November prices to Jordan had indicated US$70-90/ton decreases while their PP prices were down by US$80/ton from October. In the United Arab Emirates, most players, who had received US$50-60/ton lower PP and PE prices for November, are complaining about weak trading activities, pointing to the book closures at the end of the fiscal year. A distributor remarked, “We anticipate further adjustments from the Middle Eastern producers given the softer outlook triggered by the weaker upstream costs.” “We are away from the market as we hold high stock levels. Plus, we see that prices are coming down in line with weak demand and softer upstream costs. Many buyers do not purchase beyond their immediate needs as they anticipate further drops. China’s olefin markets are also down and players operating in those markets are not purchasing, reinforcing the additional decrease amounts,” another distributor cited. In Lebanon, a converter highlighted the unsupportive demand and said, “We anticipate further decreases in the days ahead given weak demand. We are not totally out of the market but we just cover our immediate needs to meet our limited end product obligations. In general, demand remains moderate and cash flow issues persist.” A household products converter also highlighted the impending year end, weak demand and the ongoing political problems inside the country for their bearish expectations. According to ChemOrbis, Lebanese buyers had received November prices with US$20-60/ton decreases from the Middle Eastern producers.