31 July 2013 17:27 [Source: ICIS news]
HOUSTON (ICIS)--Mexico’s Pemex reduced the price of polyethylene (PE) resins for all grades effective 30 July, hoping to restore competitiveness amid soft demand, a Pemex source said on Wednesday.
Pemex applied the largest reduction to high density polyethylene (HDPE) blow moulding, which declined by 6% from June levels.
The second largest reduction went to linear low density polyethylene (LLDPE) material for extrusion and rotomoulding applications, which declined by 5%.
Pemex reduced the price of HDPE injection material by 3% because supply of this grade is tight in Mexico. A turnaround in one production train of the 100,000 tonne/year Asahi plant is still underway.
The smallest reduction went to the different grades of low density polyethylene (LDPE), discounted by 2%.
Mexico’s domestic resins have lost some competitiveness in recent weeks with the recovery of the Mexican peso relative to the US dollar, but this was not the main motivation for the adjustment, the source said.
Market conditions led to this price reduction. Pemex expects to have a good month of sales in August, when supply is still near normal.
A series of turnarounds will affect PE production in September and October, with less ethylene available.
Domestic distributors had already noticed that demand was softening, as buyers purchased from hand to mouth because of uncertainty ahead.
Prior to this adjustment, LDPE prices were at $1,830-1,933/tonne FOT (free on truck), LLDPE prices at $1,789-1,902/tonne FOT and HDPE blow moulding prices at $1,764-1,840/tonne FOT, according to ICIS data.
Pemex is the only PE domestic producer in Mexico.
$1 = €0.75
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