05 June 2008 13:06 [Source: ICIS news]
SINGAPORE (ICIS news)--Indian polyolefins producers have hiked domestic prices of their products by up to 6.2% for the fourth time in five weeks, on the back of surging feedstock costs, the producers said on Thursday.
The last time Indian polyolefins prices went up was last week.
The sharpest rise this week was in polypropylene (PP), which rose by rupees (Rs) 5/kg to Rs85.60-89.60/kg EXW (ex-works), excluding taxes. Polyethylene (PE) prices were raised by Rs3/kg to Rs81.80-91.30/kg.
Indian producers' margins had been hit by the 5% import duty on naphtha for polymer production announced in the 2008-2009 budget, a PP producer said. “Propylene feedstock costs have also been surging, exerting upward pressure on PP,” the producer added.
“Rising prices in the international market and surging crude, naphtha and ethylene costs have reduced customer resistance,” a PE producer said.
However, a converter said it was finding it very hard to pass on the higher polymer costs to its own end user. “Producers are using feedstock costs as a crutch to improve their margins. But in the process, our margins are being squeezed,” said the converter.
But buyers had no option but to accept the higher prices as supply was tight, the converter said.
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