India domestic PE prices fall by Rs1-3/kg on softer Asian market

01 July 2011 08:37  [Source: ICIS news]

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SINGAPORE (ICIS)--Indian producers have revised their list prices of all grades of polyethylene (PE) except those of high density PE (HDPE) blow moulding and pipe material, sources close to the companies said on Friday.

This is in line with the softer southeast Asia and China markets over the past few weeks, the sources added.

“We [have] adjusted the prices in line with [the] softer southeast Asian and Chinese markets and also to remain competitive [with] the presence of [imports from the] Middle East,” a source close to Haldia Petrochemicals said.

Reliance Industries, GAIL (India), Indian Oil and Haldia announced their price reductions on 30 June. This was the fourth price revision in June.

The companies reduced their list prices by Indian rupee (Rs) 1/kg (Rs1,000/tonne, $22.4/tonne) for HDPE film, Rs2/kg for linear low density PE (LLDPE) film and Rs3/kg for linear density PE (LDPE) film with effect from 1 July.

The new prices are at Rs71.5-73/kg DEL (delivered) for HDPE film, Rs70-71/kg DEL for LLDPE film and Rs84-84.5/kg DEL for LDPE film, the sources said.

The price protection was withdrawn with effect from 1 July, the sources added.

A price protection is applied when a buyer and a seller agree to fix the prices of specified goods for the duration of a contract.

Lower import prices of the materials have suppressed domestic discussions, the sources said.

Discussions for spot prices on a CFR (cost & freight) India basis of LDPE film were at $1,500-1,540/tonne (€1,035-1,063/tonne), $1,230-1,250/tonne for LLDPE film and $1,240-1,270/tonne for HDPE film on 1 July.

In China, prices of LDPE, LLDPE and HDPE film grades were at the mid-to-high $1,400s/tonne CFR, low-to-mid $1,200s/tonne CFR and high $1,200s/tonne CFR respectively.

“Although we [have] introduced the new reduced prices [that have] dampened market sentiment, buyers are still buying small lots. [This] shows there is demand,” a source close to GAIL said.

 ($1 = Rs44.62, $1 = €0.69)

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By: Ong Sheau Ling
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