05 August 2013 22:31 [Source: ICIS news]
HOUSTON (ICIS)--US polyethylene (PE) producer ExxonMobil Chemical announced it will implement a 5 cent/lb ($110/tonne, €83/tonne) increase on all PE resins, effective on 1 September, sources said on Monday.
The company sent out two letters to customers on 2 August announcing the increase. The letter to US customers says the 5 cent/lb increase announcement "supersedes all pending price increases" while a letter to Canadian customers says the increase "is in addition to all previously announced price increases", according to copies of the letters obtained by ICIS.
Sources said it is unusual for the company to have a different pricing strategy for US customers and Canadian customers.
Given the different wording in the two letters, it was unclear whether the proposed increase would replace or supplement an existing price increase announcement of 2 cents/lb for high density polyethylene (HDPE) and 4 cents/lb for low density polyethylene (LDPE) and linear low density polyethylene (LLDPE).
A company spokesman did not immediately respond to a request for comment.
One buyer active in both US and Canadian markets said its understanding of the announcement is that ExxonMobil Chemical is still seeking the August increase, but whether or not that increase is implemented, it will seek the additional 5 cent/lb increase in September.
Unless there is a hurricane, or another major supply disruption, the buyer said it does not believe ExxonMobil Chemical will be able to implement an increase in either month. The buyer said it believes prices may actually fall in August, based on growing supplier inventories.
With a flat settlement in July, 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 74-76 cents/lb DEL for small volume buyers, as assessed by ICIS.
($1 = €0.75)
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
Asian Chemical Connections