US PE cargos provide competitive edge at year end
In Turkey,traders have been offering particularly HDPE film, blow moulding and injection from the US for the last few weeks. For those cargos, prices posted gradual decreases since the first week of December in response to lower counter bids from buyers. The prevailing HDPE prices indicate sizeable declines of $60-80/ton from last week on CIF Turkey, subject to 6.5% customs duty, cash basis.
“US PE materials have been competitively offered to Turkey recently since American sellers have to reduce their stocks before the year ends in order to avoid extra tax charges. That’s why they offered attractive prices and became an aggressive source in the import market. In turn, buyers showed interest in this origin due to good prices despite the fact that they are long distance materials,” a trader stated.
These materials grabbed visible interest from Turkish players particularly earlier this month, according to a different market player. “Whether American HDPE grades will continue to enter the market or not in the coming months is a question mark. There is market talk that some sellers of US materials preferred to halt their offers in order to track energy markets to see whether NYMEX crude oil futures will manage to hold above the $35/bbl threshold or not,” he argued.
In China, American LDPE film showed up this week at an attractive level on CIF Shanghai, subject to 6.5% customs duty, cash basis. The offer formed the low end of the overall import market. In general, activity in China’s import market is deemed as limited as most buyers prefer to meet their needs from the local market citing the advantage of domestic PE stemming from the depreciation of the yuan.
According to ChemOrbis Import Statistics, Turkey’s HDPE imports from the US were up 54% in October from the previous month. The figure at 1047 tons represented a 37% rise year on year. China’s US LDPE imports, meanwhile, were up to 14,948 tons in November, a gain of 13% month over month. The figure represented a 79% decline year on year though.
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