US PE producer postpones hikes to February

22 January 2009 21:41  [Source: ICIS news]

HOUSTON (ICIS news)--A US producer has postponed its proposed January polyethylene (PE) price increases of 7 cents/lb ($154/tonne, €119/tonne) to 1 February in response to competitor pricing, the producer said on Thursday.

A buyer said the postponement appears to have spread throughout the market, but not all producers were immediately available to confirm this.

“I had some indication from several suppliers that there is not enough behind [the price increase] to make it stick in February,” the source added.

PE availability on the secondary market has declined because of lower production rates, while overall demand remained weak, a second PE buyer said.

The source identified certain linear low density PE (LLDPE) grades where pre-buying activity had caused demand to strengthen, but that was not expected to last beyond early February.

The producer said export business was healthy, and PE grades for export had increased by 2-6 cents/lb this year.

US high density PE (HDPE) export prices were at 33-35 cents/lb FOB (free on board) Houston in bags during the week ended 16 January, 3 cents higher compared with a month earlier, according to data from global chemical market intelligence service ICIS pricing.

Domestic HDPE blow moulding contracts were assessed at 40-43 cents/lb DEL (delivered) after falling by 10 cents in December.

North American PE producers include NOVA Chemicals, Dow Chemical, Total, INEOS, Formosa, ExxonMobil, LyondellBasell and Chevron Phillips.

 ($1 = €0.77)

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By: David Barry
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