In the initial half of August 2024, the Metallocene Linear Low-density Polyethylene (mLLDPE) market displayed divergent trends across different regions, with prices increasing in Europe while depreciating in Asia. In Europe, prices surged due to supply constraints, even though demand from downstream industries like construction, packaging, and automotive remained weak. Meanwhile, the Asian market experienced a price drop, largely driven by a decline in Crude oil prices, which impacted global markets. Additionally, regional market dynamics were influenced by supply disruptions and seasonal factors, affecting downstream inquiries. As a result, the price of mLLDPE FOB Shanghai in China fell by 0.4% in this timeframe.

During this period, the European mLLDPE market saw an upward price trend, despite bearish trading activity due to the ongoing seasonal summer lull, with many market participants stepping back from business activities.  The price elevation were primarily fueled by supply constraints, as Europe faced a reduction in import shipment inflows. Current pricing trends are heavily influenced by supply-side factors, with expectations of a further decrease in import volumes by the end of September. Further, a few price settlements for August were reported, adding to the upward cost pressure on mLLDPE. The rising costs of feedstock Ethylene, fueled by increasing upstream Naphtha prices, have also contributed to the higher mLLDPE prices.

In contrast, the Asian mLLDPE market showed signs of weakness, as many downstream buyers were cautious about making import purchases, anticipating an increase in regional supplies. Market activity in Southeast Asia was subdued, with deals and selling indications shaping the assessment of polyethylene import prices, as most suppliers had already completed their sales for August shipment cargoes. Market players perceived the market outlook as bearish, influenced by dwindling demand for mLLDPE in China, despite expectations that converters would begin restocking later in August to meet year-end demand. Although freight costs for import shipments from Northeast Asia, including China and South Korea, remained high, market participants observed a gradual easing due to improved container availability. Further, a reduction in freight rates could lead to an influx of competitively priced material like mLLDPE, especially compared to Middle Eastern cargoes.

Furthermore, ChemAnalyst anticipates that the current market trend for mLLDPE will likely continue in the coming weeks.  In Europe, mLLDPE prices may keep rising due to ongoing supply disturbances, even as demand might further reduce.  Meanwhile, in Asia, prices are expected to continue easing, influenced by the sluggish demand from the downstream construction sector in the monsoon season, which could further affect product pricing. These regional dynamics are expected to significantly influence the mLLDPE market, with supply-side factors and seasonal variations playing key roles in shaping future price trends.