China PE Export Volume to Keep Rising Y-O-Y in May
In April, 2023, China’s PE export volume was 89.9kt, down 17.56% M-O-M while up 34.5% Y-O-Y. From January to April, China’s total PE export volume was 311.4kt, up 83.16% Y-O-Y. In May, the rising exchange rate of USD lent certain support to the export market. It’s estimated that China’s PE export volume may continue the uptrend in May.
In 2023, affected by the sluggish economies in Europe and the U.S., the downstream demand weakened and consumption slowed down. In addition, the crude oil price stayed at a high level, and overseas prices were high, while China’s PE price was at a low ebb. Therefore, increasing enterprises were considering exporting their products, so their export business improved notably from 2022. In May, the rising exchange rate of USD lent certain support to the export market. It’s estimated that China’s PE export volume may continue the uptrend in May.
From a global perspective, the U.S., Saudi Arabia, a certain country in the Middle East, Thailand, Russia and South Korea are export-oriented countries, and their resources mainly flow to surrounding countries benefited from convenient transportation. Meanwhile, China, Turkey, Canada, Vietnam, etc. are import-oriented countries. As for China’s market, it’s surrounded by major producers as well as abundant resources and diversified feedstock. In addition, China is in the stage of intensive capacity expansion, and its self-sufficiency is expected to improve. Therefore, the competition for China’s market in the future will be determined by costs and transportation fees. In the long term, the degree of self-sufficiency in China will determine the trade flow of the entire global resources. At that time, the supply of resources from the Middle East and Northeast Asia may be concentrated in the Southeast Asian market.
China is faced with many issues along the transition from PE importer to exporter. A major one is the global recognition of China’s PE products. Previously, China’s import dependence degree was over 48%, while the annual export volume was merely 200-500kt. It takes a long time for global downstream enterprises to accept China’s PE products. In recent years, with China’s PE market price staying at a low level, many downstream enterprises are trying to accept China’s PE products in order to save costs, so there are more changes for China’s PE products to be recognized globally and China will see more opportunities in the export market.
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