US polyethylene spot export offers were too high by about 5-6 cents/lb ($110-$132/mt) for import markets in Latin America, several traders said Wednesday.
"US offers are basically at what the CFR prices are in Latin America," a trader said.
High density polyethylene film, for example was offered out of the US at
$1,532/mt FAS Houston. The market, however, was talked at about $1,550/mt CFR to various ports in South America. Low density PE deals into South America were talked at $1,550-$1,600/mt CFR, while new US offers were just under $1,600/mt FAS Houston.
HDPE blow molding was also too high for importers as it was offered at $1,488/mt FAS, while traders were currently selling blow molding they had bought from the US in early January at close to $1,500/mt CFR.
Traders commented that they would have to add to their long positions in order to buy from the US, but many declined to do so because it was too risky. PE was also less expensive from other regions of the world, traders said, adding they would rather buy from Asia or the Middle East instead of risking money to buy from the US. There were HDPE film offers from Asia and Europe in the mid-$1,550's/mt CFR, which was closer to the market price than what they could get from the US, despite a longer transit time.
"The US is just plain out of the market," a trader said.
