Indian Oil produces fewer PE, PP grades on feedstock shortage

21 July 2011 10:00  [Source: ICIS news]

SINGAPORE (ICIS)--State-owned Indian Oil is producing fewer grades of polyethylene (PE) and polypropylene (PP) at its plants in Panipat because of a persistent feedstock shortage and the company’s plans for shutdowns in August, a company source said on Thursday.

Indian Oil operates a 650,000 tonne/year high density polyethylene (HDPE)/linear low density polyethylene (LLDPE) swing plant and a 600,000 tonne/year PP plant, each with two production lines.

The company is producing only HDPE film and HDPE blow moulding grade at one of its PE lines, and PP raffia and PP injection at one of its PP lines.

Indian Oil has been running the HDPE/LLDPE and PP plants at below 50% since the beginning of July because of a low supply of ethylene and propylene.

The supply of the feedstock materials has been tight because the company is facing technical issues with its upstream cracker at the same site.

“The [PE and PP] plants may shut in August because of the persistent feedstock problem, but nothing is firm yet,” the source said.

“We will continue to produce only these four grades for both domestic and export markets until the shutdown plan is confirmed,” the source added.

The low production output of polymers from Indian Oil and Haldia Petrochemical (HPL) has caused domestic prices of PE and PP in the Indian market to increase for the third consecutive week.

The prices of HDPE have risen by Indian rupees (Rs) 1-2/kg (Rs1,000-2,000/tonne, $23-45/tonne) and Rs1/kg for PP.

The new PE prices in India are at Rs76.50-79.00/kg DEL (delivered) for HDPE film, Rs86.00-87.50/kg DEL for PP raffia and Rs88.00-89.00/kg DEL for PP injection, subject to a 10.3% excise duty.

($1 = Rs44.48)

For more on polyethylene and polypropylene, visit ICIS chemical intelligence
Please visit the complete ICIS plants and projects database

By: Ong Sheau Ling
+65 6780 4359

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