21 June 2012 08:21 [Source: ICIS news]
By Ong Sheau Ling
SINGAPORE (ICIS)--Middle East spot polyethylene (PE) and polypropylene (PP) prices will likely fall for a second straight month for July parcels, tracking the recent months of steep declines in Asia and Europe, market players said on Thursday.
Average spot PP prices in the Gulf Cooperation Council (GCC) tumbled by $145/tonne (€115/tonne) or 9.3% to land on $1,410/tonne CFR (cost and freight) in mid-June for June delivery, after hitting a seven-month high in April, according to ICIS.
For linear low density PE (LLDPE) film, average spot prices fell by $105/tonne or 7.4% to reach $1,315/tonne CFR GCC within the same time frame.
A larger decrease was also seen in overseas markets.
Spot PP import prices in
“The price decrease seen in [the
“There is still room for prices to fall here,” the converter added.
Middle East and
“With Asia declining so much already,
Besides tracking the price fall in Asia and
“Our [LLDPE film] inventories are on the higher side. July offers will be lowered to stimulate buying, so we could better manage our stock levels,” a major Saudi PE, PP producer said.
The building up of inventories at GCC-based polyolefins makers was a result of the poor sales volume seen in Asia and
In particular for PP, a recent duty imposed in
“Prices will likely shed, rather than tumbling again, in the condition that
Moderate demand in the Gulf region in July will cap the price decline to be small, industry players said.
“Demand for most PP and PE grades has been relatively robust in June and we expect July to be similar,” a Saudi Arabian converter said, adding that healthy downstream demand was because of the upcoming Ramadan and Eid festival.
Ramadan begins in mid July, while Eid festival starts in mid August.
“Traders and converters’ inventories are low. They have been buying on a need-to basis since April. So, they will have to restock for July,” another Saudi Arabian PE, PP producer said.
($1 = €0.79)
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