20 January 2005 01:11 [Source: ICIS news]
SINGAPORE (CNI)--The Philippines’ JG Summit Petrochemical plans to raise the operating rate at its 180 000 tonne/year polypropylene (PP) plant to 100% from the existing 70% by March, three months after restarting it, a company official told CNI on Thursday.
In early December last year, the company had shut its PP plant at Batangas and a 220 000 tonne/year linear low-density polyethylene (lldPE)/high-density polyethylene (hdPE) plant at the same site due to high feedstock prices and weak margins.
The PP plant was restarted in early January after margins improved, but the lldPE/hdPe plant would be shut “indefinitely” until the company secures a cheaper ethylene feedstock supply, said the official.
A minimum spread of $130-150/tonne between PE and ethylene is required for PE producers to enjoy decent margins, he pointed out.
Ethylene prices rose to as high as $1080/tonne FOB ?xml:namespace>
Prices of lldPE were around $1000-1020/tonne CFR China last week, allowing a margin of only $50-100/tonne. The hdPE margin was even narrower at $50-80/tonne, with hdPE prices pegged at $980-1000/tonne CFR China.
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