SABIC targets €50-70/tonne increase for Europe March PE

24 February 2010 16:38  [Source: ICIS news]

LONDON (ICIS news)--SABIC aims to increase polyethylene (PE) prices in Europe by €50-70/tonne ($68-95/tonne) in March, differentiating between low density PE (LDPE) and linear low density PE (LLDPE) for the first time in many months, a source with the plastics major said on Wednesday.

“LDPE is very tight everywhere. We should be able to pass €70/tonne increases without a doubt. We are going for plus €50/tonne for LLDPE,” said the source.

Another SABIC source reported that the company would be seeking a €50/tonne increase in the high density PE (HDPE) sector.

“We have seen strong demand for commodity product these last two days as people expect higher prices in March,” he said.

Buyers accepted that they would probably have to pay hikes. But after the rollover in the March ethylene contract, which settled on 23 February at €940/tonne FD (free delivered) NWE (northwest Europe), PE buyers aimed to pay as little as possible for March PE.

“They complain about their margins, but what about ours? Do they realise how difficult it is to pass these increases on to our markets?” asked a PE buyer.

PE prices had risen by as much as €150-170/tonne in January and February combined. LDPE prices were now trading around €1,150/tonne FD NWE on a net basis.

Dow Chemical last week announced an €80/tonne increase for March PE.

($1 = €0.74)

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By: Linda Naylor
+44 20 8652 3214

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