Vietnam’s Local PP and PE Markets Give Back Part of War-Era Gains but Stay Far Above Pre-Crisis Levels

Vietnam’s domestic polypropylene (PP) and polyethylene (PE) markets have continued to soften after reaching historic highs in early April, as easing panic sentiment and weak downstream demand pushed prices lower in recent weeks.

Although the markets have corrected by around 6-9% from their peak levels, local PP and PE prices still remain significantly above pre-conflict levels following the massive rally triggered during the US-Israel-Iran conflict period.

Market data showed that current prices for LDPE, HDPE, LLDPE, and homo-PP raffia are still around 44-62% higher compared to levels seen before the war-driven rally began.

Vietnam Local PP & PE Market Overview

LDPE Film:
Peak Status – All-time high in early April
Rise from Pre-War Levels – 73%
Correction from Peak – Down 6%
Current vs Pre-War – Up 62%

HDPE Film:
Peak Status – All-time high in early April
Rise from Pre-War Levels – 55%
Correction from Peak – Down 7%
Current vs Pre-War – Up 44%

LLDPE Film:
Peak Status – All-time high in early April
Rise from Pre-War Levels – 60%
Correction from Peak – Down 9%
Current vs Pre-War – Up 45%

Homo PP Raffia:
Peak Status – All-time high in late March
Rise from Pre-War Levels – 63%
Correction from Peak – Down 7%
Current vs Pre-War – Up 52%

Markets Reached Record Levels Amid Supply Fears

Vietnam’s PP and PE markets witnessed an extraordinary rally during March and early April as geopolitical tensions in the Middle East disrupted supply chains and sharply increased crude oil and feedstock prices.

Concerns over rising freight rates, plant disruptions, and the closure of the Strait of Hormuz created widespread fears regarding the availability of Middle Eastern cargoes.

As replacement costs surged, suppliers aggressively raised prices while buyers rushed to secure material before further increases occurred.

LDPE film recorded the strongest gains during the rally, while HDPE, LLDPE, and homo-PP raffia also climbed to unprecedented levels in the local market.

However, traders noted that despite the sharp price surge, actual downstream demand remained weak throughout the rally period.

Weak Demand Triggers Market Correction

From the second half of April onward, the market started correcting lower as panic buying gradually faded and underlying weak demand conditions resurfaced.

Buyers increasingly shifted back toward hand-to-mouth purchasing strategies, while converters faced growing resistance from end-users who were unwilling to accept elevated finished-product prices.

As a result, sellers struggled to maintain earlier record-high levels, leading to a gradual correction across both PP and PE markets.

Market participants also pointed out that the recent decline has only partially erased the earlier rally, with prices still considered extremely high relative to real demand conditions.

Buyers Remain Cautious Amid Ongoing Weakness

Many traders and converters continue adopting a cautious wait-and-watch approach, expecting further corrections in the coming weeks.

Several buyers said they are delaying replenishment purchases because current price levels still remain difficult to justify amid weak end-product demand.

Some distributors also noted that they prefer avoiding fresh imports due to elevated import costs and long shipment lead times, while others fear potential inventory losses if prices continue falling further.

Despite easing supply concerns compared to earlier months, market participants believe Vietnam’s domestic polyolefin markets may remain under pressure unless downstream demand improves significantly or import costs decline more visibly.

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