Prime virgin prices are from China’s major virgin polymer websites in Renminbi RMB. The exchange rate is 1 US dollar= Chinese Yen at 6.7927.
Crude old prices closed in New York nearly two dollars higher than the Asia market at $81.64 on continued signs of robust demand and supply concerns.
Prime prices in China have not reflected the uptick in oil prices and have remained unchanged over the last two weeks. Markets eye on the gradual recovery of Covid-19 after the Lunar Year break. Since the country abandoned the Covid-zero strategy two months ago, many people have fallen ill from the Covid infection. Workers quit, and factories have closed down early ahead of the Chinese New Year vacations, disrupting production. The possibility of a big Covid-19 rebound shortly is remote, as 85 % of the population has tested positive. Market participants see the light at the end of the tunnel after the Chinese New Year vacation.
Recycled pellet markets are badly impacted, with almost unchanged prices by the immense disruption from the Covid-19 related illness and Chinese New Year holidays. Some traders speculate that factories should expect a sudden U-turn recovery as the pandemic would ultimately leave us behind. There were market participants before the Chinese New Year who would only buy materials if prices were competitive enough to take a chance. Many people commented that the worst had passed. As soon as China resumes operation by February, customers will line up to place orders; a progressive recovery is on its way.
Scrap plastics imported to Southeast Asia for recycling have been slow before the Chinese New Year on concerns about continued declines in prime prices. Scrap plastics like PET thermo-foaming film and bottles, low-grade PE films, agricultural waste plastics, big bags, natural PE film, and production scrap materials are vastly available. Unfortunately, prices often could not match between buyers and sellers as recyclers worried costs of recycled materials might further slide due to adverse market situations in China. The Chinese pandemic recovery situation is still a concern. Medical experts expect a second wave right after the Chinese New Year holidays, followed by the third and fourth waves in March and April, and so on. Many Chinese recyclers have taken the opportunity of returning to China for the Lunar Year family reunion after the lift of three years of quarantined restrictions for travelers returning from overseas. Most of them have not seen their loved ones for three years!
Finally, I wish everybody and the family a happy Lunar New Year with good health and prosperity for 2023.