Restart of Nigeria PE, PP business to be slow after strike suspended

17 January 2012 12:44  [Source: ICIS news]

LONDON (ICIS)--Trade in the Nigerian polyethylene (PE) and polypropylene (PP) markets will resume on Tuesday after a week-long strike was suspended, industry sources said. 

The restart is expected to be gradual in Nigeria, and in the wider western African region.

Unions suspended the strike on Monday after President Goodluck Jonathan agreed to cut the cost of fuel after a week of nationwide strikes caused by the removal of fuel subsidies.

Trade had slowed down in western Africa following the strikes held in Africa's most populous country, and some said they had even stalled imports into neighbouring countries.

Western Africa is a net importer of PE and PP.

"In the west [of Africa], trade has slowed down because of Nigeria. People were unable to confirm orders, there were issues in terms of getting payments," said a major Middle East-based producer that regularly exports to Africa.

Although trade will return to normal in Nigeria, neighbouring Ghana might not be so fortunate, said a Nigeria-based producer.

"Ghana has witnessed one of the sharpest depreciation of around 12–13% against [the] US dollar in [the] first week of the new year," the local producer added.

Ghana's currency, the cedi, fell to an all-time low against the US dollar of 1.72 by midday on Monday 16 January. Imports are usually priced in US dollars.

Inquiries from customers in western Africa are filtering in slowly, but "it has not recovered pace, not to the full extent," said the exporter.

In comparison, inquiries from buyers across other regions of Africa have picked up this week, said the producer.

In western Africa, prices fell last week on weak buying interest, and were at $1,330–1,500/tonne (€1,051–1,185/tonne) CFR (cost and freight) for PE and at $1,380–1,490/tonne CFR for PP.

($1 = €0.79)

For more on PE and PP visit ICIS chemical intelligence

By: Cuckoo James
+44 (0) 208 652 3214

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