26 September 2012 22:31 [Source: ICIS news]
HOUSTON (ICIS)--NOVA Chemicals informed customers on Wednesday that it will split its initial nomination for a 5 cent/lb ($110/tonne, €85/tonne) increase for October PE prices over two months, with 3 cents/lb in October and 2 cents/lb in November.
"We continue to hear that it is helpful to settle prices early in the month. We trust this letter provides the clarity you are seeking," the company said in a customer letter obtained by ICIS.
Unless other PE producers follow suit, the move will once again make NOVA the outlier in the PE market.
In August, most of the US PE market settled prices higher by 5 cents/lb, while NOVA settled at an increase of 3 cents/lb in August and an additional 2 cents/lb in September. The market was expected to come back together in October, with most producers seeking a 5 cent/lb increase for the month.
No other producers were heard to have lowered the amount of their October increase.
One buyer said the split settlement in August indicates that the rest of the market will not follow NOVA. While the company is a large supplier in film grade PE, it is not as important a player in high density polyethylene (HDPE) markets, which allows other producers to ignore NOVA's competitive offer, sources said.
However, another market participant said it believes the market should settle flat in October, with very little to support an increase.
Current prices for linear low density polyethylene (LLDPE) butene film were at 67-70 cents/lb DEL (delivered), low density polyethylene (LDPE) film prices were at 76-79 cents/lb DEL and high density polyethylene (HDPE) blow moulding prices were at 65-68 cents/lb DEL, for small volume buyers, as assessed by ICIS.
($1 = €0.77)
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