The polymer market in Vietnam is under heavy pressure due to abundant sources of PP, PE, PVC, PET and PS products from China at competitive prices. The lack of significant domestic demand recovery has led Chinese polymer suppliers to direct their goods to export markets, especially the most neighboring market, Vietnam.
A recent market report that China is increasing Covid cases also raises concerns about the long-foreshadowed demand recovery in the country, namely a wave of infections. New infections across China will mean prices continuing to fall not only in Vietnam but in all of Southeast Asia .
PP: Raffia from China hits $900 CIF Vietnam
The low end of imported PP homo raffia in Vietnam fell to $900/ton this week, as competitive quotes from China pushed prices lower.
Some converters said they received Chinese PP homo raffia quotes at $920-930/tonne CIF, cash, down around $40/ton from last week, while some transactions were completed. listed at $900/ton CIF of the same origin, this has led to a deeper drop in prices.
China's low-segment quotes put pressure on other origins, with India's homo raffia PP being quoted at $920/ton CIF at the end of the week. One buyer said: “Suppliers originating from the Middle East find it difficult to compete because their quotes are nearly $100/ton higher than the Chinese seller's price. They may also adjust their prices soon.”
PE: Saudi Arabia's re-export quotes continue to put pressure on low-end segments
In the import PE markets in Vietnam, the number of re-export quotes from China increased significantly this week. Saudi Arabian origin shipments diverted from the country to Vietnam were quoted at $970/ton CIF LDPE film, $980/ton LLDPE film and $1000/ton HDPE film, all forming lower segments of the market.
Such low prices suggest a weekly decline of around $10-30/ton, while buyers stay on the sidelines in anticipation of further price declines.
A Vietnamese trader said: “The quotes for LDPE and LLDPE are mostly below the threshold of 1000 USD/ton CIF due to the massive influx of re-exports from China. For LDPE, transactions even for Southeast Asian origin were signed at around USD 980/ton CIF. Demand is rather weak, as most market participants are wary amid the potential for a deeper slide.”
Falling quotes from China continue to shape the lower end of Vietnam's imported PVC market this week, with market participants saying that suppliers from China have become more competitive in recent times. This. Quotation of K67 based on ethylene from China is currently at 750-760 USD/ton CIF Vietnam, 30-50 USD/ton lower than other origins.
Traders predict that China's supply in Southeast Asia will increase further due to India's move to impose quantitative restrictions (QR) on the import of PVC with a residual VCM content of more than 2 parts. million. China's surplus supply will be redirected to the regional market, along with weak demand conditions that will put the Vietnamese PVC market under pressure.
Competitive quotations from China have also been a hot topic in the Vietnamese PET bottle market in recent weeks. The overall import price range is estimated at $930-1030/ton CIF for the current week, cash, with a low segment formed as Chinese quotes are significantly lower than quotes from other origins. .
A source from a Thai manufacturer said: “We continue to lower our quotes due to lower raw material prices and sluggish demand as well as the presence of cheap shipments from China. Although our prices are lower, it is a challenge to compete with them in both export and domestic markets.”
For PS, the situation is similar to other polymers in recent weeks, China's competitive quotes put pressure on Vietnam's import GPPS and HIPS market while both have reached lowest level since October 2020.
“A flurry of competitive quotes for duty-free Chinese materials has found its way to Southeast Asia, especially Vietnam, dragging prices down to the lower end of the price range,” said one buyer. The weakness in demand in the region continues and PS suppliers from other origins cannot compete.”
