13 October 2010 19:22 [Source: ICIS news]
LONDON (ICIS)--Africa polyolefin spot prices gained $20-40/tonne (€14-29/tonne) this week as sellers successfully raised their October offers on the back of stronger sentiment in China, market players said on Wednesday.
This had caused a dearth of fresh Asian offers into Africa, according to local sources. Those sources noted that strong prices in South America were also proving more attractive for US sellers who traditionally move volumes into western Africa.
Meanwhile, the weaker US dollar also discouraged European importers from offering into the northern African market, limiting supply further. As such, Middle Eastern sellers were considered the key source for product.
With production issues in the Middle East, PP was considered to be tighter than PE and saw gains of $40/tonne, leaving values at $1,300-1,340/tonne CFR (cost and freight), as assessed by ICIS. Those figures were registered in the northern Africa homopolymer PP market, which had sustained the highest losses in previous weeks.
Meanwhile, low-density PE (LDPE) – which was widely regarded as the tightest grade – only saw marginal movements of $20-30/tonne at the higher end of business as offers widened, suggesting that prices may have hit their peak.
Indeed, several manufacturers commented that the African polyolefins market was now one of the weakest in terms of pricing and demand globally, as a cautious sentiment prevailed among buyers.
“We have seen an increase in demand and enquiries from most regions, and prices have increased, but not on the scale as the quantum leaps we have seen in other regions," a manufacturer said.
The sustainability of the price rally also was a cause for concern among market players.
“There is not a huge level of confidence in the market,” said one producer. “The market is very unsteady and there is another Chinese public holiday coming up, which will probably affect demand. We are taking it day by day.”
($1 = €0.72)
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|