China’s polymer futures uptrend slows on weak fundamentals

07 September 2009 13:28  [Source: ICIS news]

SINGAPORE (ICIS news)--China’s linear low density polyethylene (LLDPE) and polyvinyl chloride (PVC) futures rose 0.6-1.8% on Monday morning but then lost momentum in afternoon trading due to weak supply-demand fundamentals in the physical markets, industry sources said.

November LLDPE futures, the most actively traded contract on 4 September, closed at yuan (CNY) 10,345/tonne ($1,515tonne) on Monday afternoon, after rising to a high of CNY10,480/tonne earlier in the day.

This was an increase of CNY55/tonne, or 1.8%, from the 4 September settlement, according to data from the Dalian Commodity Exchange (DCE).

November PVC futures, the most actively traded contract on Monday, gained slightly in morning trading but eventually edged down 0.7% from the 4 September settlement price to close at CNY6,955/tonne, according to DCE data.

Expected LLDPE supplies from two new local plants, which are run by Dushanzi Petrochemical and Fujian Refining and Petrochemical Co, have dampened sentiment in the futures and physical markets, a local futures broker said.

Sentiment in the PVC physical market was weak, with demand in China about to enter a seasonal lull in the fourth quarter of the year, local PVC traders and producers said.

($1 = CNY6.83)

With additional reporting by Ng Hun Wei

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By: Chow Bee Lin
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