04 October 2012 18:32 [Source: ICIS news]
HOUSTON (ICIS)--Polypropylene (PP) prices in Argentina are steady in October, remaining at levels seen in September, market sources said on Thursday.
Initial talks to increase prices by $40-50/tonne (€31-39/tonne) in October have been replaced with a September price rollover, according to buyer sources.
It is unclear if the measure is being rolled back as a response to declining market conditions or as a reaction to government disapproval of the increase – a common occurrence in Argentina – or both.
Transformers see steady overall conditions, but noticed that estimated demand from clients has failed to meet targets in September, resulting in accumulation of stocks.
This will likely have an impact on October resin demand from transformers.
Resin purchases may be curbed by 10-20% in October as transformers consume September raw material leftovers.
An October PP price increase could depress demand further under these conditions.
Transformers and distributors have not received October price increases from any of the two local producers.
September resin sales were within targets, a producer said, attributing the good demand to seasonal spikes from raffia, pipes, caps and automotive sectors.
Import restrictions remain in place, but the system appears to be more flexible, allowing a nearly normal entry of Brazilian products, mainly biaxially oriented PP (BOPP), fibres and compounds for the automotive industry, sources said.
PP prices in Argentina are currently at $1987-2053/tonne for raffia, while injection material is in the range of $2,063-2,096/tonne, according to ICIS data.
The two producers in Argentina are Petroquimica Cuyo and Petroquimica Ensenada (Petroken).
($1 = €0.78)
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