13 March 2013 02:16 [Source: ICIS news]
MEXICO CITY (ICIS)--Polyolefins markets are going through a period of contraction in March, aggravated by a great degree of uncertainty in prices, said the producers and distributors of polyethylene (PE) and polypropylene (PP) on Tuesday.
“Sales were strong during January, but February was a terrible month,” a source with the local producer said during the Plastimagen 2013 plastics conference.
That opinion was shared by distributors, who saw a market contraction of 20-25% in February.
There is optimism that March will be a better month than February, but only because sales were so weak during February.
Another factor slowing down domestic sales is the currency exchange. The Mexican peso is strengthening against the US dollar of late, favouring sales of imported resins.
The uncertainty in the market stems also from hard-to-predict conditions for April.
There are already some signals that PE prices may go up by 2-4 cents/lb ($44-88/tonne) in April, but with inventories growing throughout the petrochemical chain, sellers cannot envision price hikes taking hold.
The Plastimagen conference lasts through Friday.
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