Turkish players voice early PP, PE expectations for November

Oct. 12, 2018

Market players in Turkey have mostly concluded their October business with rollovers for PP and drops for PE in October. However, trading remained limited to moderate quantities due to the ongoing financial issues. 


Meanwhile, early expectations for November have started to be expressed in the polyolefin markets. 


The sentiment for next month appears firmer for PP than PE, which has been the case for the last few months, based on relatively better activity and supportive propylene costs on a global scale. Reduced supplies from Saudi Arabia in the midst of shutdowns at NATPET and Petro Rabigh also contributed to the stronger view. Meanwhile,stocks have already diminished as a result of cautious replacement activities on the side of traders. 


Nonetheless, reduced purchasing power in the wake of the ongoing weakness of the Turkish lira and liquidity issues are likely to keep any hike attempts in check, according to converters. A global trader affirmed, “Our higher prices did not see acceptance by our customers although demand for PP was better than PE for another month.” A PP converter also commented that increases for PP would not be beyond $10-20/ton as Azeri cargos from SOCAR’s new plant would partially offset supply limitations for other origins. 


In the PE market, LDPE and LLDPE prices are projected to follow a stable trend in November, meanwhile. Some players do not exclude the possibility of seeing some increases, saying, “Sellers may seek small hikes for LLDPE as prices already fell notably during the last 4 months. Also, LDPE is supported by a long turnaround at the domestic producer, Petkim.”


However, HDPE film still draws a weak scene based on a lack of supply issues, the ongoing presence of American cargos and tepid demand from end markets, many players affirmed. A source from a Middle Eastern supplier admitted, “We had difficulty in selling our allocation and had to be more aggressive to conclude HDPE deals this month. For November, LDPE and LLDPE markets may witness rollovers while HDPE film may still have room for small drops if demand remains discouraging.” 


Contributing to the overall sentiment in Turkey, a Saudi Arabian major revealed its October offers to China with $50/ton hikes for PP, while cutting its prices by $20/ton for HDPE film and $10-20/ton for LDPE film right after a week-long National Day holiday. The source sought rollovers or $10/ton increases for LLDPE, however.