03 January 2014 17:29 [Source: ICIS news]
LONDON (ICIS)--Metallocene-based linear low density polyethylene (MLLDPE) buyers are facing price hikes for January, following the €15/tonne increase of the January ethylene contract, but the amount is not yet clear, sources said on Friday.
“One of my suppliers has mentioned plus €50/tonne ($68/tonne),” said a buyer.
A producer, with non-metallocene LLDPE, said it would be targeting a €50-60/tonne increase but that business had not yet started for 2014 in much of Europe.
The increase in import duty from most Middle Eastern suppliers into Europe was implemented on 1 January, and duties rose from 3% to 6.5%.
It is in the C4 - butene based - LLDPE market where the upward pressure from importers is expected to be strongest, as Europe is a net importer of C4 LLDPE for around 90% of consumption, with the majority of imports coming from the Middle East.
Producers sources said export demand for MLLDPE is strong and inventories are well under control. Several producers closed their LLDPE order books early in December for lack of product.
There has been jostling for market share in parts of the MLLDPE sector in recent months, but cutbacks and potentially fewer imported LLDPE volumes as Middle Eastern suppliers turn towards Asia for better netbacks could support price hikes in Europe, said some sources.
Most agreed, however, that it was too early to tell where January pricing would land, particularly with naphtha prices under downward pressure.
MLLDPE prices in December were trading around €1,380-1,420/tonne FD (free delivered) NWE (northwest Europe).
($1 = €0.73)
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