02 April 2009 06:37 [Source: ICIS news]
By Prema Viswanathan
SINGAPORE (ICIS news)--Indian producers have hiked their domestic polymer prices by up to 7% or $80/tonne (€60.8/tonne) this week to mirror the sharp spike in import values on the back of strong demand, sources close to the companies said on Thursday.
While some end users were concerned that the price increases will place additional pressure on margins, others said that the rise in polymer prices had resulted in a surge in orders for finished goods.
“Deals for polypropylene (PP) and polyethylene (PE) imports into ?xml:namespace>
Deals were heard this week for PP at $1,050/tonne CFR (cost and freight) India for raffia grade PP, $100-120/tonne higher than the $930-950/tonne CFR India reported last Friday by global market intelligence service, ICIS pricing.
The improving sentiment in the key
“Even the volatility in crude prices, which has dipped to $49/bbl from $54/bbl a week ago, has not dampened sentiment, as buying interest is very strong,” said a trader.
Tight supply due to outages and diversion of cargoes to the lucrative
"Currently, domestic supply of PP is so restricted that we have been waiting for weeks for material to be delivered,” said an Indian PP converter.
Demand was strong, with buying activity picking up with the start of the new Indian financial year on 1 April.
“We would like to build our inventories now, as demand from the packaging and agriculture segments is quite robust, but the high prices are a deterrent,” said a PE end user.
Some end users said they had earlier wanted to keep inventories low in anticipation of an influx of low priced imports from new
Producers raised PP prices by Indian rupees (Rs)3-4/kg to Rs60-64/kg
($1 = Rs50.62, $1 = €0.76)
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