Non-European HDPE exerting pressure on Italy

After buyers returned from the sidelines to make inquiries in Italy's spot HDPE market as of the start of the second half of June, more competitive offers started to be reported below 1,080 euro/ton FD North Italy, 60/90 days deferred payment. Apart from offers for regular origins such as European and Middle Eastern cargoes, some non-European origins have started to show up with quite competitive prices standing at least 100 euro/ton below that of other offers.
Late last week, a buyer purchased Central Asian HDPE film cargoes at 990 euro/ton FD North Italy, cash payment in the spot market, which comes to 1,015 euro/ton when adjusted to 60/90 days deferred payment. As he had already bought at very competitive prices, he said he was not planning to purchase through gentlemen's agreements this month. He also noted that HDPE supply for this Central Asian origin is ample.
This week, a trader has also started to offer HDPE blow moulding for a new Saudi origin at 1,000 euro/ton FD North Italy, 60 days deferred payment. However, he complained that he is still not able to conclude deals at this price so far.
The rest of the market for HDPE film and blow moulding has been pegged at 1,080-1,200 euro/ton for West and South European origins over the week. Even though non-European origins are exerting a clear downward pressure on the local HDPE market, European sellers seem unwilling to offer discounts, holding back to their rollover requests. Nevertheless, the comfortable availability in the region as well as the persistent downturn in global PE markets may continue to draw competitive non-European origins into Italy's HDPE market. The dollar equivalence of the prevailing market level for regular HDPE origins comes to 1,340-1,488 dollar/ton with parity at 1.24 whereas recent Middle Eastern HDPE cargoes are offered at levels as low as 1,170-1,180 dollar/ton to Turkey on CFR, subject to 3% duty basis. (Source ChemOrbis)