03 April 2013 19:21 [Source: ICIS news]
HOUSTON (ICIS)--US polyethylene (PE) producer Dow Chemical announced it will implement a 4 cent/lb ($88/tonne, €69/tonne) increase on all grades of PE, effective on 1 May, sources said on Wednesday.
The price increase nomination is in addition to a 4 cent/lb increase the company previously announced for April, according to a copy of a customer letter obtained by ICIS.
The announcement, dated 1 April, offers no reason for an increase. However, Dow this week began the turnaround process at its Freeport cracker in Texas. The turnaround at the 1.655m tonne/year unit is expected to last for 60 days, sources said.
While the Dow turnaround and other planned cracker turnarounds are expected to tighten supply somewhat this month, sources said they do not believe there is enough justification for an additional price increase.
Many buyers and some producers have expressed scepticism that the proposed April increases will be implemented, particularly after PE prices just rose by 4 cents/lb for all grades over February and March.
"My impression is that most suppliers are not real confident the April 4 cent/lb increase will happen in April, if at all," said one buyer. "I don't think [Dow] will get support on this one from other manufacturers unless something additional happens in ethylene production."
Globally, PE prices have been falling recently, which is limiting US producers' ability to sell into the export market. Sources said that is another factor that may keep prices from rising in the coming months.
Prices for LLDPE butene film were at 74-76 cents/lb DEL (delivered), LDPE film prices were at 83-85 cents/lb DEL and HDPE blow moulding prices were at 72-74 cents/lb DEL, for small volume buyers, as assessed by ICIS.
($1 = €0.78)
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