Mainstream Middle Eastern producers started to approach Turkey with new offers and sell ideas for PP and PE for July as per the pricing service of ChemOrbis. Some producers are already seeking increases over their June prices citing their limited availability while others are voicing slightly firmer sell ideas.
Many buyers confirmed receiving higher prices and found them high while they are planning to negotiate with their suppliers to obtain some discounts from the initial announcements. Buyers cited the high dollar/TL parity, which is hampering activities in their end product markets, as well as their cash flow issues as reasons behind their unwillingness to pay increases while also pointing to possible market lethargy owing to the approaching Ramadan.
In the PP market, a manufacturer reported receiving an initial PP fibre offer from a Saudi Arabian supplier on CPT basis. The price represents a $20-30/ton increase from early June for this specific origin. “We are not interested in this material since its price is too high,” he said.In the PE market, three buyers received new July PE offers from a major Middle Eastern producer. According to buyers, the producer’s new prices from their bonded warehouse are up by $20-50/ton for LLDPE c4 film and by $20/ton for HDPE film.
A buyer who received new LDPE film, LLDPE c4 film and HDPE film offers from the supplier found their new offers to be a bit high. “However, these are initial prices and we feel that there is room to negotiate for discounts of around $10/ton,” he said. His sales are doing okay but he thinks that the overall market is muted. “The rising dollar has significantly hindered activities, while holidays and upcoming Ramadan are likely to keep the market slow in the coming days,” he commented.
A packaging converter said, “We did not expect the $50/ton hike we received for July LLDPE c4 film prices from our Middle Eastern supplier. We hope to obtain $10-20/ton discounts after negotiations.” He is currently facing collection problems, while his end product sales are a bit slow. A second packager conceded to pay $20/ton increases and purchased some material from the producer. “Our end product sales are not doing great but are just normal due to the summer holidays,” he commented.
A Middle Eastern producer reported that they announced their July prices with increases of $30-50/ton for LLDPE, $40/ton for HDPE and $20/ton for homo-PP while announcing rollovers on their PP block copolymer prices. “Demand is a bit slow now, although we think that buying interest will pick up over the next few weeks,” a source at the producer stated, adding that their allocation will be a bit limited in July.
Apart from newly revealed offers, two producers expressed their sell ideas with increases. A producer is mulling over announcing $20-30/ton increases on their July PP fibre and HDPE film prices for a Middle Eastern origin. “The market is quiet for the time being,” a producer source commented, adding, “Our availability will remain limited into the month of July.” A different regional producer reported planning to announce $10-20/ton increases on their LDPE film and LLDPE c4 film prices for July. “We expect to make our official announcements either at the end of this week or the start of next week. Demand had been very poor for June but we are more optimistic about July thanks to the start of the agricultural season,” a producer source said.
According to ChemOrbis, a source at another Middle Eastern producer said, “We kept our homo PP, PPBC injection, LDPE film and HDPE blow moulding prices flat heading to the end of June.” He pointed to their very limited availability, adding, “Our head office is pushing us to announce increases to Turkey. We hope to see either rollovers or small increases since we are not very optimistic about demand.”
A trader commented that the local market will have a hard time accepting the new July prices being given by producers, but added that new July prices might work if supplies remain tight.