PolymPart: Polymer prices in Asia are coming under further pressure because of a lack of resin demand as the region grapples with the coronavirus pandemic.
Polypropylene (PP) and polyethylene (PE) prices have steadily declined since the coronavirus outbreak worsened in January, and the search for a bottom continues.
Spot prices of linear low-density PE (LLDPE) film in China fell close to a 12-year low last week, while PP raffia prices slumped to a four-year low.
Argus assessed LLDPE film prices in China at $770-790/t cfr and PP raffia prices at $800-830/t cfr on 19 March.
The coronavirus outbreak is coming under control in China, with locally transmitted cases kept to a minimum in the past few days.
Workers in the petrochemical industry are slowly returning to their jobs and polymer plants in China are increasing production to 80-90pc, after weeks of reduced operations.
Inventories at state-controlled Sinopec and PetroChina edged up to 1.285mn t on 18 March from 1.27mn t a week earlier.
But social activities are being kept to a minimum and the economy is still weak, meaning downstream plastic demand – with the exception of hygienic products – is still slow.
Demand for woven bags, home appliances, construction materials and the packaging sectors in China continues to be heavily hit by the outbreak.
Petrochemical buyers remain deeply concerned about low crude oil prices, given their strong correlation with feedstock ethylene and propylene values.
Front-month Nymex crude futures closed at $23.36/bl yesterday, down by 62pc since the start of this year.