27 July 2011 07:20 [Source: ICIS news]
SINGPORE (ICIS)--Polypropylene (PP) raffia prices in the Middle East are rising as the sentiment of buyers has improved in view of the firm China market and tight regional supply, market players said on Wednesday.
Regional PP raffia for August changed hands at $1,520-1,530/tonne (€1,049-1,056/tonne) DEL (delivered) Saudi Arabia, $1,560/tonne DEL United Arab Emirates (UAE) and $1,560-1,570/tonne DEL Jordan on 27 July, the players said.
The prices are $30-60/tonne higher than those seen in July, ICIS data showed.
Converters in the Middle East said they are now more willing to procure cargoes for August, as prices bottomed out in early July and have been on an uptrend since then (please see graph).
Some converters added that they have plans to buy more material next week if the market continues to firm.
PP raffia prices in the Middle East hit a two-month low in early July at $1,510-1,530/tonne DEL Dubai and at $1,470–1,480/tonne DEL Saudi Arabia.
The buying sentiment in the Middle East was also boosted by the firmer PP prices in China, where restocking activity is ongoing in anticipation of scheduled turnarounds at a number of domestic polymer facilities in August and September, market players said.
Business in the region has slowed ahead of the Muslim fasting month of Ramadan, but an unplanned shutdown and the reduced operating rate at some major PP facilities has kept regional supply tight, said the players.
National Petrochemical Industrial (NATPET) is operating its 400,000 tonne/year PP plant in Yanbu at low rates, while the output at Petro Rabigh’s 700,000 tonne/year PP plant has been affected by the prolonged shutdown at its high olefins fluid catalytic cracker (HOFCC) in Rabigh, Saudi Arabia.
In addition, Al Waha Petrochemical’s 450,000 tonne/year PP plant in Al-Jubail will remain shut until end-July because of technical issues.
“The weaker demand [in the Middle East] is balanced out by the reduced regional supply,” said a regional PP producer, adding that prices have risen on the back of the firm China market.
($1 = €0.69)
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