Report for China & South East Asia

The following table shows recent prime prices taken from China’s major virgin polymer platforms, inclusive of VAT and quoted in Renminbi (RMB) which has an exchange rate of 6.9703 to the US dollar at the time of writing:

A January rebound in New York WTI crude oil prices was largely driven by a renewed geopolitical risk premium, despite the market remaining structurally oversupplied. Heightened tensions surrounding Iran, including concerns over tighter enforcement on Iranian crude exports and internal unrest, raised fears of potential supply disruptions.

Additional support came from fresh US sanctions targeting Venezuela’s oil sector and further drone attacks on Russia’s energy infrastructure.

In China, prices of most prime virgin polymers duly moved higher or stabilised, reflecting a combination of strengthened cost support, improved market sentiment and increasing policy guidance aimed at preventing further price erosion. Notably, Beijing has recently reiterated its intention to curb excessive production capacity and discourage disorderly price competition as persistent daily price declines have been weighing on upstream profitability and market stability.

Against this backdrop, producers across several polymer chains have shown greater pricing discipline, with some reducing operating rates, prioritising contract deliveries or limiting spot availability. At the same time, the rebound in crude oil and key chemical feedstocks has reinforced cost floors, while pre-Lunar New Year restocking provided additional short-term support.

All that said, the recent upturn appears more corrective than structural. While prices have recovered from earlier lows, trading activity has quickly demonstrated signs of slowing as downstream buyers become increasingly cautious amid weak order visibility and seasonal demand softening. In the absence of a fresh catalyst on the demand side, price movements are likely to narrow into a consolidation range, with downside risks re-emerging should inventories rebuild or policy support lose its immediate signalling effect.

Recycled materials have not reflected the increases in prime resin prices. In Vietnam, sellers report that the price of China-bound rPE natural pellets has remained around US$ 750 per tonne CNF Shanghai, unchanged from the previous month. Recycled PP and PE black pellets are still priced at US$ 500 per tonne or lower, with mixed PP/PE even cheaper. HIPS and ABS recycled pellets with RoHS and REACh certification are around US$ 800 per tonne. rPET flakes have been trading at US$ 530-580 per tonne while pellets are priced at US$ 860-900.

In Europe and the USA, rHDPE milk bottle pellets and rPET flakes and pellets generally command higher prices than in Asia owing to sustainability programmes. A few PE film recyclers in the USA have also gone out of business, and prices for different PE film scrap grades have dropped steeply.

Scrap plastics are not showing any improvement. In Vietnam, recyclers report that it costs around US$ 4000 to clear a container, while in Malaysia some recyclers have reported that law enforcement officers have requested payments during goods clearance, making import costs uncertain. Overall, recyclers do not feel the market is improving.

Currently, film scraps and big bags are barely moving in Malaysia, and engineering plastics such as PC and PMMA can be sold only in natural colour. The PET market is very slow for film, bottles and lumps, although PETG may have slightly better outlets. PS and ABS prices are often too low to meet supplier expectations. Most prices have declined compared with last month, and the situation is unlikely to improve until after the Chinese New Year.