Italian truck strike to boost prompt PET demand

19 June 2008 11:13  [Source: ICIS news]

LONDON (ICIS news)--Fears over an upcoming Italian truck strike could prompt a boost in polyethylene terephthalate (PET) demand next week as buyers look to build stocks, market sources said on Thursday.

 

“We believe the strike will run from 30 June until 4 July. This could be a disaster for the market, so we have bought extra material for delivery next week to guard against possible disruptions,” said one Italian consumer.

 

The combination of the planned strike and expectations of higher PET prices in July could lead to a major lift in demand, although the Italian PET sector still sounded weaker than much of the rest of Europe.

 

Uncertainty over exactly where bullish key raw material pricing would land in July also made it difficult to judge just how well the PET market was performing in terms of real demand rather than pre-buying activity.

 

“So far in June demand wasn’t great in Italy and we have been running our plant at 70% rates while our others run flat out, but we expect the market to pick up. Next week will be busier than normal if these strikes go ahead,” noted a PET producer.

 

Italy has also been more prone to imports from Asia and the Middle East than the rest of Europe.

 

Hikes of around €50/tonne ($78/tonne) were widely mentioned for European PET contracts in June, although lesser rises were mentioned in Italy, in one case of €30/tonne.

 

Truck strikes have been seen across Europe in recent weeks and also in South Korea over high fuel and energy costs.

  

($1 = €0.64)

By: Edward Cox
+44 20 8652 3214

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