01 February 2011 08:06 [Source: ICIS news]
SINGAPORE (ICIS)--Vietnam’s polyethylene (PE) and polypropylene (PP) demand continued to grow at double digits last year, mainly driven by the local food packaging application sector, industry sources said on Tuesday.
Vietnam is estimated to have consumed 800,000 tonnes of PE and 650,000 tonnes of PP in 2010, based on import and local PP output data, and not taking into account the re-export volume, local traders said. There is no domestic PE production in Vietnam.
These are 27% and 14% higher compared with the 630,000 tonnes of PE and 570,000 tonnes of PP used in the same period the previous year, they added.
Import activity was severely hampered in the second half of last year because of a shortage of US currency. The local government had curbed the inflow of US currency as part of its efforts to cap the country’s widening trade deficit, local traders said.
The official exchange rate was pegged at Vietnamese dong (D) 19,500 to one US dollar for most of last year, but it was very difficult to obtain US dollars at the local banks, they said.
US currency was available in the black market, but at a much higher rate of more than D22,000 to one US dollar, and that had made imports too costly for local companies, they added.
Additional reporting by Malini Hariharan
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