18 December 2013 16:49 [Source: ICIS news]
These include holidays, end-users already holding sufficient stocks, and a severe drought this year in Uganda, one of the major east African markets.
“Unlike other years we had uncharacteristically low [demand this month],” a Kenya-based distributor said. “We had our country’s 50 year independence anniversary, and a subsequent long holiday weekend from the 12th December to 16th December.”
As with other markets, Christmas holidays are another factor.
“From the majority of customers I have spoken to, they intend to shut down operations from the 20th [December] and resume after the New Year,” the source added.
Poor December demand has been exacerbated by end users already holding high inventories.
A second distributor said: “In December, most of our end users from east Africa were carrying high inventories of raw material, especially of homopolymer raffia and PE's.[polyethylene grades]. Enquiries are not coming from end users.”
In Uganda a severe drought this year has negatively impacted polymer business.
“Uganda, one of major markets in east Africa is going through a bad patch,” the second distributor continued. “The reason being a severe drought.”
The source added that the agricultural industry – vital to the country’s economy – is suffering.
“Converters of raffia bags are carrying very high inventory of raw material and finished product,” the distributor continued.”Collection is also a major issue.”
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