SINGAPORE (ICIS)--Polyethylene market players in Vietnam said downstream plastic manufacturers in the country have thus far not been affected by the government’s announcement of a 15-day isolation period, which started 1 April, but some said plant operating rates could eventually decline as demand slows.
Vietnam is an key market for PE exporters as the country does not have major domestic producers and PE imports are free from duties, making it a highly competitive environment.
In the week ended 27 March, linear low density PE (LLDPE) import prices in Vietnam fell to $730-790/tonne CFR (cost & freight) Vietnam, the lowest on record since ICIS began tracking the data in August last year.
So far in the week, initial offers have been heard within that range at around $770/tonne CFR Vietnam, but few deals had been transacted at these levels because of the increasingly bearish environment, sources said.
PE market sources said that currently, Vietnam’s plastics factories were largely running as normal, but expressed likelihood of a decline in production rates due in part to the number of workers that would be allowed to work and also because of a lack of transportation services.
“[Factories have] not yet stop production but most factories have to reduce production rate,” said one market source.
Vietnam residents are required to stay at home unless for essential needs and only certain companies are allowed to continue operating during the period, according to various media outlets.
Public gathering of more than two people have been banned and public transportation has been suspended, the reports said.
Vietnam’s efforts mirror that of some other southeast Asian countries such as Malaysia, which have taken a more aggressive stance in their efforts to counter the coronavirus pandemic.
Focus article by Izham Ahmad