The drop, which first occurred in Middle Eastern polyolefin markets in April, extended into July. Domestic PP and PE prices in Saudi Arabia have hit their lowest levels since late 2020, according to a report. after the United Arab Emirates market. Meanwhile, Eastern Mediterranean markets have seen a deeper bearish trend with PP and PE imports to Jordan and Lebanon falling to three-year lows.

Saudi Arabian market falls for third consecutive month

A new PE quote from a major Saudi supplier for the domestic market shows a decrease of about 150-300 SAR/ton ($40-80/ton) month-on-month. This large producer also reduced PP prices by about SAR 263/ton ($70/ton) compared to June.

Following quotes from major suppliers, new PP and PE quotes from another local supplier show a monthly decrease of SAR 263-375/ton ($70-100/ton). The new quotes are mostly in line with market expectations, shaped by persistently weak market activity, which has sent prices trending lower for the third month in a row. The ChemOrbis Price Index says this has brought the weekly average price to its lowest level since November 2020.

Falling prices fail to boost demand in UAE

In the United Arab EmiratesUnited Arab Emirates, Middle Eastern suppliers initially announced their new quotes for July with a $50/ton discount from the latest June prices. Meanwhile, the buyer tries to get an additional discount from 20 USD/ton to 90 USD/ton from the original price. According to data from ChemOrbis Price Index, PE and PP prices have hit their lowest levels since late 2020.

Meanwhile, the country's domestic PP supplier, Borouge, reduced its July quote to $70/ton from the latest June price. “The market remains quiet amid loose supply and below-average demand,” said a local producer.

Downtrend gains momentum in the Middle East

In the Eastern Mediterranean market, import PP and PE prices maintained a downtrend for the fourth consecutive month. The ChemOrbis Price Index shows the lowest levels since mid-2020 for these markets. The market's persistently weak fundamentals and global bearish sentiment continue to push prices further lower. Meanwhile, market participants in these regions expressed concerns about making any new purchases due to the ongoing bearish trend.

In Lebanon, traders said they received new PE and PP quotes in July from Middle Eastern suppliers with a reduction of 40-50 USD/ton for PE compared to the most recent transactions in the month. 6. Meanwhile, the US PE material continues to influence the general sentiment of the market, down 30-40 USD/ton compared to the latest June price.

Besides, PP and PE quotes for Jordan in July decreased by 50 USD/ton compared to June. A local source said: “Sellers cut prices in an effort to boost demand. However, buyers refrained from making new purchases amid continued weak demand and a bearish market outlook.”

Demand concerns continue to shape the market outlook

Market participants across the region expect the downtrend to continue until the end of July, citing rising inflation and low exchange rates amid a sluggish end product market. . Additionally, the recent uptrend in crude oil futures is short-lived, which thwarts any bullish intentions in the near-term.