Middle East PE, PP prices rise on tight supply

25 April 2007 12:16  [Source: ICIS news]

SINGAPORE (ICIS news)--Polyethylene (PE) and polypropylene (PP) prices in the Middle East rose by up to 3.6% for May, up $50/tonne on April levels, market players said on Wednesday.

 

The rise was driven by tight supply due to shutdowns, as well as low operating rates and buyer inventories, suppliers, traders and end users said.

 

Low density PE (LDPE) prices showed the sharpest rise, jumping by $50/tonne in the Gulf Cooperation Council (GCC) region to $1,430-1,440/tonne delivered (DEL), as buyers snapped up offers at these levels. Business for LDPE was reported at the same levels in the East Mediterranean (East Med) region.

 

Offers of Asia LDPE were quoted at $1,400/tonne CFR GCC for the May shipment. Bids could not be traced but traders said there should be buyers at this level in view of the higher regional prices.

 

Transactions of film-grade high density PE (HDPE) and linear low density PE (LLDPE) were concluded $20/tonne higher at $1,350/tonne DEL in the GCC and at $1,380/tonne DEL in the East Med.

 

PP prices also rose by $20/tonne for all grades to $1,360-1,380/tonne DEL in the GCC and $1,380-1,400/tonne DEL in the East Med.

 

Supply was restricted, especially for PE, with suppliers short of material due to strong demand in the GCC and depleted inventories following maintenance turnarounds. Gas supply problems also kept operating rates low in Kuwait.

 

However, some traders said market fundamentals were weak in the East Med due to political instability and importers had bought mainly because their stocks were depleted.

 

By: Prema Viswanathan
+65 6780 4359

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