04 November 2009 16:29 [Source: ICIS news]
By Linda Naylor
LONDON (ICIS news)--Exports of polyethylene (PE) to Asia from Europe are being fixed for December but not all producers are keen to exploit the arbitrage opportunity, sources said on Wednesday.
“We are exporting in a fairly big way to ?xml:namespace>
He continued: “We are selling premium grades in particular, with LDPE non-commodity grades going in the high-$1,200s/tonne CFR.”
This equates to €816/tonne CFR (cost and freight) at Wednesday’s exchange rate. But with commodities trading below this level, not all European producers were interested in moving volumes to
“You can’t really get more than the low $1,200s/tonne CFR for ordinary LDPE, and we aren’t able to sell at that level,” said another producer.
European PE demand was poor, however, and at least one selling source saw the current demand from
“This takes away the pressure for the end of the year,” said the exporter. “European buyers have been destocking for the last couple of months. Nobody wants high stocks at the end of the year. We are all running for cash, but in January buyers could get a shock when they can’t get hold of any material.”
PE buyers in
“The first week of November has been quite good,” said a re-seller, “but converters are saying that they won’t be buying any more later in the month.”
Another reason for caution from European converters was the expectation of new capacities, which have been heralded for many months, mainly from the
Plastics major SABIC also had a new 400,000 tone/year LDPE plant due on stream in the
New volumes had not yet had much impact on the European market, however, and large buyers expressed frustration at the inability to take advantage of new capacities.
Next year was widely expected to see these volumes, however, if not directly within Europe then as a displacement for potential exports from
PE producers in
($1 = €0.68)
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