FocusIndian polymer makers hike prices

03 June 2008 04:46  [Source: ICIS news]

By Prema Viswanathan

SINGAPORE (ICIS news)--Indian polymer makers have hiked domestic prices of their products by up to 7.7% for the third time in a month as feedstock costs surged due to a sharp depreciation in the value of the rupee (Rs) against the dollar, producers said on Tuesday.

The sharpest rise was in polypropylene (PP), which rose by Rs 6-6.50/kg to Rs80.60-84.60/kg EXW (ex-works), excluding taxes. Polyvinyl chloride (PVC) rose by Rs4/kg to Rs61.50/kg.

Polystyrene (PS) increased by Rs4/kg to Rs76/kg for general purpose PS (GPPS) and Rs79/kg for high impact PS (HIPS).

And polyethylene (PE) went up by Rs4/kg to Rs57.50/kg and Rs78.80-88.30/kg.

"The rupee's value against the US dollar has depreciated by 7% in the past month, and this has exerted severe pressure on Indian producers' margins," a PP producer said.

Indian producers' margins had already been hit by the 5% import duty on naphtha for polymer production announced in the 2008-2009 budget, a PE producer said.

“We have to make the most of the peak demand season, which will end with the advent of the monsoon next month,” a PVC producer said. 

Strong demand from the construction segment and the huge shortfall in India has boosted buying sentiment, but there is little appetite for cargoes to be delivered in July and August.

“Rising prices in the international market and surging feedstock costs have made customers realise that they can no longer resist the price hikes,” a PS producer said.

Major polymer producers in India include Reliance Industries, Haldia Petrochemicals, Gail India, Finolex Industries and Supreme Petrochem.

($1 = Rs42.38)

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By: Prema Viswanathan
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