Turkish PE players hunt for signs of a market bottom amid pending Nov offers

With its healthy premium over Asia now gone, Türkiye’s import PE market saw players searching for signs of a market bottom over the week. The market has been in flux amid the recent gains in shipping costs, poor netbacks that may repel global sellers, the potential year-end lull prior to the book closures and the foggy demand outlook. While Middle Eastern offers were yet to take shape, most projections called for minor price changes.

Since mid-October, players have preferred to monitor market dynamics domestically and in other PE markets after attending key industry events such as the Fakuma International Trade Fair and the Eurasia Packaging and Food-Tech Fairs. Additionally, the national holiday on October 29 further delayed fresh offers, keeping price discussions on hold in early November.

What do sellers and buyers foresee?

In late October, Middle Eastern LDPE prices were assessed at $1140-1160/ton CIF Türkiye, subject to a 6.5% customs duty, cash. LLDPE C4 film and HDPE stood at $1020-1040/ton and $1010-1030/ton, respectively. A trader commented, “Margin concerns may deter sellers, who might instead direct sales to Asian outlets if demand remains strong there. If LDPE prices stabilize, this could also help limit discounts on LLDPE.” Meanwhile, some buyers still believe that LLDPE prices could reach the $1000/ton CIF mark on deals if competitive American cargoes continue to apply pressure through the year’s end.

Several players concurred that import PE prices from the Middle East had little room for additional drops, pointing to netback, which suggested narrowing gaps with the region. Türkiye currently trades $20/ton below China’s LDPE market, while LLDPE C4 film and HDPE film carry a premium of $70-95/ton. Türkiye’s premium over SEA narrowed to $15-25/ton across all PE grades due to recent gains in the region’s import markets.

Players are watching closely to see if PE sellers will enter the market with rollovers. The market is in flux, influenced by lower oil prices, approaching year-end book closures, and financial challenges on the one hand; firmer PE prices in Asia , higher shipping costs for next month , and supportive ethylene markets on the other. Demand will be eyed, as buyers may replenish some stocks for Q1 2025 to take advantage of low prices this month and hedge against any shifts in market sentiment, even as end markets remain subdued.

import PE prices had bottomed out by mid-December last year before the market turned up driven by a logistics turmoil amid the Middle East conflict.

Hiked duties on compound imports create glimmer of hope for HDPE

Meanwhile, multiple players noted higher freight rates from Iran due to a reduced number of trucks, which may pave the way for a firmer stance among PE sellers. Additionally, HDPE supply from Iran is expected to decline in the medium term now that Türkiye has imposed extra duties on various plastic compounds imported from non-WTO countries , except for the Republic of Azerbaijan. According to initial projections, this recent move will support the HDPE market and its derivatives.

“Deliveries from Iran may be facing congestion, as players have only one month to bring in previously ordered plastic compounds before the new duties take effect. Considering this recent move, compound imports are expected to stop, and availability will tighten by December,” a player opined.

Signals for American PE stay under close watch

As Q4 proceeds, PE players will closely monitor ex-USG quantities and prices. US offers were last assessed steady at $1160-1190/ton for LDPE, and lower at $960-990/ton for LLDPE C4 film and $960-1000/ton for HDPE film and b/m, CIF, subject to 6.5% duty for late November shipments.

“Traders have started warning us that these levels might be the bottom for American PE, as shipments are likely to slow down toward Christmas,” a consumer noted. However, other players still expect to see LLDPE C4 film transactions at the $950/ton CIF threshold if Middle Eastern suppliers agree to slightly lower deals month over month and demand for distant cargos remains in the doldrums in Türkiye.