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Asian Viewpoints

Polyethylene market in China

In the polyethylene market in China, a recovery in demand was delayed after the Lunar New Year holidays in February and sellers rushed into offering since they had high stocks of petrochemical products. Although China Petroleum & Chemical Corp (Sinopec) and PetroChina Co Ltd recently reduced their polyethylene inventories and selling pressure was eased, they still have high stocks, according to sources. Additionally, due to Russia's invasion of Ukraine, crude prices are sharply rising. Ethylene prices also strengthen and feedstock costs of polyethylene are increasing.

 

As for supply, a number of facilities had troubles and stopped operations and some facilities plan to conduct regular maintenance. Thus, supply in March is expected to decrease and sources perceived that sellers may try to reduce their stocks further going forward. On the other hand, operation rates of derivative facilities are gradually recovering.

 

Under such circumstances, there were views that the market may rise in near future. State-owned petrochemical companies, however, still have high stocks and operation rates of derivative facilities are restricted with the National People's Congress being held. Thus, some sources felt that it is unlikely for the market to rise significantly.

Shanghai : Kim Setsubai   +81-3-3552-2411Copyright © RIM Intelligence Co. ALL RIGHTS RESERVED.