APIC 2016: Middle East, SE Asia PE to be displaced as China, India import demand shrinks quarter

Date:2016-05-24 08:54:00

Net demand from the two biggest polyethylene import markets in Asia -- China and India -- will decrease, lending to a displacement of Middle Eastern and Southeast Asian material globally, according to market participants on the sidelines of the Asian Petrochemical Industry Conference which runs May 19-20 in Singapore.
Traders put net 2016 import estimates of China at slightly more than 8 million mt/year while India is expected to import just under 1 million mt this year, about 20-30% less than last year's volumes.

This was due to upcoming capacity in China, Iran and India amounting to around 3 million mt/year. They will dominate the commodity grade polyethylene market for year to come as Middle Eastern producers starts to manufacture more of the specialty PE grades, the market sources added.

As the biggest polyethylene demand center China gradually imports less, Middle Eastern and Southeast Asian supplies to China would need to find a new home, according to market observers.

Traders surveyed mentioned West Africa, and other hard-to-reach markets such as Bangladesh as their next supply targets.

"The premiums to these places are very healthy," a trader said.

TypeInfo: Industry News

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