03 November 2011 09:22 [Source: ICIS news]
SINGAPORE (ICIS)--November polypropylene (PP) raffia prices in the Middle East have fallen as regional producers reduced their prices to match those in other markets such as Europe and ?xml:namespace>
The prices of benchmark injection-grade PP were at $1,420-1,430/tonne (€1,037-1,044/tonne) DEL (delivered) Gulf Cooperation Council (GCC) or $1,400-1,430/tonne CFR (cost & freight) GCC, while those of raffia-grade PP were at $1,400-1,430/tonne DEL East Mediterranean (East Med) or $1,360-1,390/tonne CFR East Med for November cargoes, according to the players.
The November fixtures are down by $105-115/tonne or 6.9-7.7% from the prices seen in October, ICIS data showed.
PP raffia prices began falling in early August and have since declined by $135-175/tonne or 8.7-11.3%, they added.
November transaction prices have declined as GCC-based producers were forced to lower their offers in view of the recent falls in the
“They have to reduce offers, otherwise their inventories will build up,” a Jordanian trader said.
“Our order books are thin. In order for us to compete in the European market, we have to have lower raw material costs,” a Saudi Arabian converter said.
“[Regional] plants are running well now, which is not good news given the smaller appetite from the market,” a Dubai-based trader said.
However, trading activity has improved because of the steep decline in November PP prices, local players said.
“Stock levels are low, with many converters thinking that prices have bottomed out. They are willing to buy more on the condition that producers are willing to match their buying ideas,” another Dubai-based trader said.
($1 = €0.73)
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