Brazil’s Braskem lowers February PE prices

12 February 2009 00:08  [Source: ICIS news]

HOUSTON (ICIS news)--Brazil’s Braskem will continue lowering polyethylene (PE) prices in February to gradually close the gap between Brazilian and international prices, the company’s PE commercial manager said on Wednesday.

The adjustment will cut Brazilian reais (R) 100/tonne ($44/tonne, €34/tonne) in February for all grades of PE.

It was not clear if the price cuts would meet market expectations, considering that international prices are still much lower.

With the February reduction, Braskem’s minimum price of low density PE (LDPE) in Brazil will be set at R3,850/tonne ($1,704/tonne). By comparison, export prices in the US Gulf average $860/tonne, according to global chemical market intelligence service ICIS pricing.

Although Brazilian companies do not need to set prices at US Gulf levels due to protective import tariffs, the current prices in Brazil remain well above the import parity.

The price reductions are intended to stem the flow of imports into Brazil and speed up sales in February, a month that will be further shortened by Carnival celebrations, the Braskem source said.

($1 = R2.26)

($1 = €0.78)

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By: George Martin
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