10 November 2011 04:26 [Source: ICIS news]
By Chow Bee Lin
SINGAPORE (ICIS)--China’s linear low density polyethylene (LLDPE) import trade has stalled as the sharp fall on the LLDPE futures market early on Thursday has caused uncertainty in the market outlook, industry sources said.
There was no buying interest for spot cargoes after the futures plunged, but spot prices are holding up, local traders said.
Most local traders were unwilling to sell November cargoes at below $1,200/tonne (€888/tonne) CFR (cost & freight) China because their import costs were at around $1,140-1,180/tonne CFR China, they said.
Traders sold cargoes at $1,200-1,220/tonne CFR China earlier in the week, they added.
China’s LLDPE futures trade was halted early on Thursday after prices fell by 5% on concerns about the eurozone debt crisis.
“The sharp fall in this morning’s futures prices was triggered by an external factor, so sellers in the spot market are not that bearish,” a Shanghai-based PE trader said.
A Zhejiang-based PE trader said it remains to be seen how the plunging futures would affect the spot market.
“The sharp fall in futures was not caused by developments in China, so it is unclear if it will have significant impact on China’s spot PE market,” he said.
“Given the [current] uncertainty, there will not be much buying interest even if we drop our price offers to below $1,200/tonne CFR China,” he added.
($1 = €0.74)
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