SE Asia HDPE pipe prices stable to firm amid tight supply

24 January 2018 06:41 Source:ICIS News

SINGAPORE (ICIS)--Spot high-density polyethylene terephthalate (HDPE) pipe prices in southeast Asia were stable-to-firm this week, shrugging off the weakness in feedstock ethylene market, because of tight supply.

On 18 January, black HDPE 100 pipe weekly prices were stable at $1,550-1,570/tonne CFR SE Asia (dutiable), while non-dutiable material firmed by $10-15/tonne to $1,580-1,615/tonne CFR SE Asia, according to ICIS data.

“Material is still tight, and ethylene prices haven’t impacted HDPE pipe prices yet,” a producer said.

Prices of feedstock ethylene had declined by $35/tonne over two consecutive weeks, halting their general uptrend since November 2017. In the week ending 19 January, ethylene prices were assessed at $1,295/tonne CFR SE Asia, according to ICIS data.

HDPE pipe prices in southeast Asia, however, are being propped up by tight supply, with Middle Eastern suppliers opting to sell to the Chinese market, where demand is robust amid ongoing projects to switch to using gas from coal for power generation in northern China.

“When the weather warms up in northern China [in March or April], the projects will start running at full speed again, which will mean the Chinese market will need more HDPE pipes,” a trader said in Mandarin.

This might mean that more supply from the Middle East will flow into China, and consequently, a dearth of material available to southeast Asia which would support prices.

Source: Plastic pipes. Source: Design Pics Inc/REX/Shutterstock

By Ruth Loh