Recently, the petrochemical market in the Middle East is facing a tight supply situation. In addition to the shutdown of some refinery plants, the more important reason is the shortage of container supply.
According to a report from Axioms Singapore, the transportation difficulties of petrochemical products caused by the shortage of container supply will continue until March.
For polyethylene, due to the strong demand for polyethylene in the Middle East in the main export markets, and the supply in the Middle East is still limited, the lack of polyethylene export supply in the United States has caused the major polyethylene producers in the Middle East to have sold out Supply quotas for major grades of polyethylene.
For polypropylene, the reduction in the spot market supply of polypropylene in the Middle East in January has meant that most suppliers have sold out their quotas and are preparing to announce an increase in polypropylene prices in February. Market participants in Jordan look forward to better demand in February, as the government has announced the phased lifting of restrictions on the new crown epidemic.
In terms of other chemicals, the spot consumption of polymerized methylene diphenyl diisocyanate (PMDI) in the Middle East market is still sluggish. The demand in the construction sector of the Gulf Cooperation Council (GCC) countries has not rebounded and has maintained a downward trend, covering the prospect of container shortages in the coming weeks. However, on the other hand, the consumption of toluene diisocyanate (TDI) in the Middle East has been supported by the increasing demand for downstream polyurethane (PU) foam.
The supply of polyether polyol (POP) in the Middle East is tight, while demand remains stable. South Korean POP producers sold out most of their goods in January and February, leading to tight supply in the Middle East POP market, while the continued shortage of containers has made the situation worse.
Buyers of polyethylene terephthalate (PET) in GCC found that the delivery date of their previously ordered PET shipments in Asia was delayed by about one to two weeks. Given the recent tight supply of containers and shipping, this situation has become commonplace.
The shutdown of a series of petrochemical production facilities in Asia means that the sales pressure of Asian PET suppliers to sell products to the Middle East is reduced, which is consistent with the idea that buyers in the GCC region are more willing to purchase goods in the region to improve the safety of goods delivery. In China, Zhejiang Wankai New Materials shut down its 400,000-tonne PET production facility for maintenance in November last year. The shutdown will take more than a few months, and the restart date cannot be predicted at present. China Resources Chemical also shut down its PET production facility with an annual output of 400,000 tons for one-month maintenance. A set of PET production equipment in Taiwan was shut down for maintenance around mid-January, and the downtime may exceed one month. At the beginning of December last year, India's IVL Dhunseri began to shut down a PET production line for maintenance and postponed the expected restart date to the end of January.
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