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Morning Briefing - 13 May 2025The announcement of a 90-day pause in tariffs between the US and China has injected fresh optimism into the Asian polyolefin market, with industry participants anticipating a surge in short-term demand—particularly from American buyers looking to place rush orders. |
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CommoPlast
Morning Briefing
13 May 2025
Brent: $64.96 (á $1.05)
WTI: $61.95 (á $0.93)
Naphtha CFR Japan: Stable
Ethylene CFR NEA: Stable
Ethylene CFR SEA: Stable
Propylene FOB Korea: Stable
Propylene CFR China: Stable
*Data represent closing prices of the previous trading day
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US-China Tariff Pause Spurred Demand Optimism
The announcement of a 90-day pause in tariffs between the US and China has injected fresh optimism into the Asian polyolefin market, with industry participants anticipating a surge in short-term demand—particularly from American buyers looking to place rush orders.
Although the news broke after the Dalian Commodity Exchange had closed for the day, limiting any immediate reaction in China’s PP and PE markets, it nonetheless triggered swift responses across the supply chain. Several domestic suppliers moved quickly to suspend their price offers, signalling expectations of firmer pricing in the near term.
Traders, particularly those focused on PE, re-entered the spot market for prompt restocking. However, the broader market remains cautious. While the tariff reprieve has boosted sentiment, many downstream converters are adopting a wait-and-see approach, questioning whether a sustained rebound is feasible.
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Indonesian PP, PE Markets Extended Declines
The Indonesian PP and PE market has entered its sixth straight week of decline, with little indication of an imminent rebound. Over the weekend, a major domestic producer significantly reduced spot offers once again, attributing the continued downtrend to persistent demand weakness, a strengthening Rupiah, and intensifying regional competition.
Despite the steep adjustments, which pushed spot PP and PE prices to multi-month lows, buying activity remained subdued. Market players remain cautious, with many hesitant to commit to new purchases amid expectations of further price erosion.
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