Shandong Yulong Auction: Zero deals as buyers reject unattractive offers amid market weakness

Shandong Yulong’s latest auction concluded with no successful transactions across all PP and PE grades, marking a complete sell-through failure as bearish sentiment gripped the Chinese market.

The auction's dismal outcome was largely attributed to a rapid deterioration in market sentiment, driven by a sharp drop in global crude oil prices and a concurrent selloff in Dalian Commodity Exchange polyolefin futures. Signs of de-escalation in the Middle East conflict further pressured energy markets, weakening the buying appetite across the board.

“Amid the external volatility, the producer’s reluctance to adjust prices made the parcels uncompetitive versus spot levels,” a trader remarked. “Buyers saw little value in committing under such uncertain conditions.”

Market observers also pointed to structural changes on the platform following Shandong Yulong’s recent conclusion of its distributorship evaluation. With traders no longer contractually bound to absorb volumes from the auction channel, participation has become entirely discretionary—heightening the risk of poor turnout when pricing does not reflect prevailing market dynamics.

Unless the producer recalibrates its pricing strategy to align with current sentiment, sluggish activity is expected to persist in upcoming sessions.

Written: Kat Yun Yun

Edited: Rochelle Nguyen