Turkish PE, PP prices keep climbing following Asian trend

Source: ICIS News

2017/08/11

The limestone pillars called

LONDON (ICIS)--Turkish polyethylene (PE) and polypropylene (PP) prices have continued to rise this week, breaking a slump that began in March, according to sources.

Some players are now more convinced this will become a trend for August and September.

Months of weak sentiment and hand to mouth buying appear to be coming to an end.

Weak import demand in China previously dampened sentiment in Asia and Turkish buyers were happy to sit and watch prices fall form both products.

With summer well underway and many players on holiday in various regions, expectations were for stable to soft pricing to continue.

An uptick in Asian prices has stirred the market back to life and players are now players looking to secure stock before the Eid al-Adha festival, at the beginning of September.

SPOT PRICES 
 
Price Range
Four Weeks Ago
PE LDPE
CFR Turkey Middle East Origin 
USD/tonne
+30
1180-1200
n/c
1150-1170
CPT Turkey Iran Origin 
USD/tonne
+20
1190-1220
n/c
1170-1220
PE LLDPE Butene C4
CFR Turkey Middle East Origin 
USD/tonne
+10
1120-1140
n/c
1100-1140
CPT Turkey Iran Origin 
USD/tonne
+10
1120-1130
n/c
1100-1130
PE HDPE Film
CFR Turkey Middle East Origin 
USD/tonne
+20
1080-1100
+10
1050-1090
CPT Turkey Iran Origin 
USD/tonne
+10
1040-1090
n/c
1020-1080
PE HDPE Blow Moulding
CFR Turkey Middle East Origin 
USD/tonne
+40
1060-1080
+30
1010-1030
CPT Turkey Iran Origin 
USD/tonne
+40
1060-1100
+50
1010-1030
PE HDPE IM
CFR Turkey Middle East Origin 
USD/tonne
+10
1030-1070
n/c
1010-1070
CPT Turkey Iran Origin 
USD/tonne
+10
1060-1070
+10
1040-1060


Supply levels have come under strain for certain grades, with high-density blow moulding currently short, according to a trader, on the back of a turnaround last month, when blow moulding was ample and dragged down prices of other PE grades.

Some sources have suggested that while prices have risen, sales are started to level out this week.

“They are seeing some price increase signals... [but] there is no big change on their sales,” said one trader.

“In fact, they have to buy more but mostly they are waiting,” it added, adding that although demand is building, further build-ups may depend on prices continuing to rise, rather than fuelling the rise themselves.

SPOT PRICES 
 
Price Range
Four Weeks Ago
PP Homopolymer Raffia
CFR TURKEY (Indian and Middle East Origin) 
USD/tonne
+30
1090-1110
n/c
1020-1070
CPT TURKEY (Iranian Origin) 
USD/tonne
+70
1120-1140
+60
1040-1050
PP Homopolymer Fibre
CFR TURKEY (Indian and Middle East Origin) 
USD/tonne
+40
1120-1150
+30
1050-1100
CPT TURKEY (Iranian Origin) 
USD/tonne
n/c
1100-1160
+20
1090-1130
PP Homopolymer Injection
CFR TURKEY (Middle East Origin) 
USD/tonne
+10
1080-1100
n/c
1070-1100


Some sellers are closing their August sales this week, according to a source.

While this is traditionally the period when a month’s sales are closed, sellers may be keen to consolidate their position and make new, potentialy higher, offers in September.  

Uncertainity about supply from Iran may fuel worries of supply issues. The Turkish authorities have postponed recently introduced measures governing imports from Iran, but there is currently no indication of when these may return.

The lack of clarity may affect consumer confidence in Iranian material although, for the time being, a source said that interest in Iranian product has increased.

A trader, in contrast, said that some players were wary of Iranian product.

With muliptle uncertainties in play, there is already some resistane to price increases. While this is currently proving ineffective, looking ahead the arguments may build consensus.

Rising prices in other regions may add upwards pressure, with Turkey relying heavily on imports, Turkish prices need to stay competitive to ensure a steady flow of material.

The coming weeks may be vital in establisihng the price trend for PE and PP going into the next few months.

Pictured above: Limestone pillars, called 'fairy chimneys', in Turkey's Cappadocia region
Source: Mint Images/REX/Shutterstock

Focus article by Ben Lake