03 April 2013 17:26 [Source: ICIS news]
LONDON (ICIS)--South Africa-based producer Sasol has rolled over its April polyethylene offers for domestic business, a number of industry sources said on Wednesday.
Sasol's April low density polyethylene (LDPE) offers are at South African rand (R) 13,750/tonne ($1,488/tonne), unchanged from March. The company's April linear low density polyethylene (LLDPE) offers are at R14,650/tonne FD (free delivered), also having rolled over from March.
These prices are unconfirmed by Sasol, but confirmed by a number of other market participants in South Africa.
The rollover comes despite poor demand for PE in South Africa.
“The polymer market [demand for polymers] in SA [South Africa] has dropped significantly,” a buyer said on Wednesday.
On 27 March, a trader said: “The markets are still very flat [in South Africa] and demand still lacklustre. Orders are still very much hand-to-mouth, as and when the customers are getting close to running out.”
It is thought a lack of competition from importers, as a result of the South African rand/US dollar exchange rate, could be maintaining local producers’ prices.
On Wednesday the buyer said: “The rand has weakened drastically [against the US dollar], and both April and May [Sasol prices] were rollovers.”
“The exchange rate is still a hindrance to importers at the moment, as the cost of material has massively increased,” the trader said on 27 March.
On the same date, speaking of the Sasol rollover, another trader said: “In South Africa, the status quo is maintained. It’s extremely difficult to compete with imports into SA. [There is] Aggressive pricing from Sasol, plus the exchange rate.”
Sasol and South African HDPE producer Safripol is thought to hold 80% of the country's PE market share.
($1 = R9.24)
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