China traders re-export PE, PP for higher returns

11 July 2008 12:44  [Source: ICIS news]

SINGAPORE (ICIS news)--Imported film grade high density polyethylene (HDPE) and linear low density PE (LLDPE) have been offered for re-export from China to markets where returns were higher, Asian traders said on Friday.

 

Buying ideas for imported LLDPE in the China market were hovering around $1,820-1,830/tonne CFR (cost and freight) for prompt delivery but international traders seeking to re-export the material were willing to pay at least $10/tonne more, a trader in east China said in Mandarin.

 

“We received a lot of enquiries from Japanese and South Korean traders with international sales networks for re-exporting PE,” the east China trader said.

 

The re-export value of LLDPE works out to be close to $1,890/tonne FOB (free on board) China after adding port and land transport charges, he added.

 

“Ten dollars makes a big difference in today’s market where high [resin] prices have left very little room for traders to manoeuvre,” he said.

 

A second trader in east China said film grade HDPE re-exports offered at $1,860-1,870/tonne FOB China for prompt shipment were snapped up by international traders who could sell the cargo on to markets such as India where prices were higher.

 

Film grade HDPE discussions were hovering around $1,900-1,960/tonne CFR India this week, according to global chemical market intelligence service ICIS pricing.

 

Meanwhile, traders in Indonesia said they received offers of Middle East yarn grade polypropylene (PP) re-exports at $2,050/tonne CFR (cost and freight) Indonesia, for July loading at Shanghai port in east China.

 

Re-exporting PP to Indonesia at this price level would be a more attractive option for traders as demand was weak in China where buying ideas were barely touching the $2,020/tonne CFR China level, Chinese traders said.

 

PP prices in Indonesia had risen sharply in the recent weeks as local PP production cuts caused by power outages had tightened domestic supply.

 

For more on PP and PE visit ICIS chemical intelligence  

To discuss issues facing the chemical industry go to ICIS connect

By: Chow Bee Lin
+65 6780 4359

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly