08 January 2014 17:11 [Source: ICIS news]
LONDON (ICIS)--While the African polypropylene (PP) market is only just starting to ramp up following the holiday season, at least some producers are seeking to raise prices by $30-60/tonne, sources said this week.
The main reason for the hike is demand oustripping a reduced supply.
There are said to be production problems at some plants in the Middle East, but these could not be confirmed by the producers in question.
A Middle East producer of homopolymer raffia said: “We’re $30-40/tonne above December. We have demand, it's increasing from the Middle East and Africa. There [are] too [many] requests for material, not enough supply from others [other producers]”.
The source added that customers are accepting the hikes, as they need the material.
The same producer also increased block copolymer prices.
“We announced for January an increase for $40-60/tonne,” the producer said. “[There is] good demand in west and north, and east Africa... Kenya, Tanzania and Uganda.”
The source added that there was some resistance from customers, but they accepted the hikes in the end.
However, two other producers deem it too early to properly assess the market.
One says it may target a price hike of $30/tonne, while the second says it will likely hold prices stable because of the Chinese market slowing.
With the Lunar New Year holiday commencing on 31 January, business in China has weakened.
The African market often tracks the Chinese one, albeit with a lag of a few weeks.
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