Venezuela’s Pequiven to guarantee plastic resins supply

29 July 2011 20:41  [Source: ICIS news]

HOUSTON (ICIS)--Venezuela’s Pequiven will guarantee supply of resins to plastic processors, reinforcing domestic production with more than 40,000 tonnes of imported plastic resins, Hugo Dell’Oglio, president of the Venezuelan Plastic Industry Association (AVIPLA), said on Friday.

In a meeting held earlier this week, Pequiven signed agreements with private companies to guarantee supplies of polyethylene (PE), polypropylene (PP) and polyvinyl chloride (PVC) to Venezuelan plastic processors, Dell'Oglio said.

Domestic production had proven to be inadequate to supply industry needs because, with an annual growth of 8%, demand had outstripped supply.

Pequiven counts on support from state institutions, as well as public banking resources, to provide $80m (€56m) in credit to finance demand from the sector for the next 5 months, according to Pequiven's president Saul Ameliach, quoted by the local press.

There will be imports of 21,000 tonnes of PE, 7,000 tonnes of PP and 13,000 tonnes of PVC, totalling 41,000 tonnes, Dell'Oglio said.

The 21,000 tonnes of PE will be composed of 12,000 tonnes of low density polyethylene (LDPE), 4,000 tonnes of high density polyethylene (HDPE) and 5,000 tonnes of linear low density polyethylene (LLDPE), Dell'Oglio added.

The PP imports will include homopolymers and copolymers, but the relative proportions were not specified.

These resins are scheduled to arrive in Venezuela during the August-December period and will take care of industry needs through the end of the year, Dell'Oglio said.

The imported resins will be sold in Venezuela at international prices. Usually, domestic products are sold at lower, subsidised prices.

Scarcity of resins has diminished because Venezuela has already imported 30,000 tonnes of plastic resins, Dell'Oglio said.

Shortages of electricity are still ongoing. Companies have been encouraged to increase production, but they must do so maintaining efficiency, measured with production/consumption ratios.

Companies that do not maintain efficiency ratios are penalised with progressively increasing fines, Dell'Oglio said.

The raw materials will be distributed among about 1,000 companies affiliated to AVIPLA and other plastic consortia operating in the country, Dell'Oglio said.

Pequiven has been supplying polystyrene (PS) raw materials for some time to Estizulia, a private local producer.

($1 = €0.70)

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By: George Martin
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