MOSCOW (MRC)--The September shutdown of the two largest producers of high density polyethylene (HDPE) in Russia did not lead to another wave of price rises with some grades remaining static with August, according to the ICIS-MRC Price Report. HDPE prices have begun to rise in Russia since August on seasonal strong demand and turnarounds at Gazprom neftekhim Salavat and Nizhnekamskneftekhim.
PE prices continued to rise in September on the back of the shutdowns of the two largest producers. Stavrolen and Kazanorgsintez, but the price increase mostly affected film and pipe polyethylene, while changes in other segments were insignificant.
Gazprom neftekhim Salavat was shut for much longer than initially planned. The shutdown started from 1 July and aimed to be finished before the beginning of August, but due to problems in the production of ethylene, the restart of HDPE production was only on 27 August.
The long shutdown of Gazprom neftekhim Salavat resulted in a shortage of natural pipe PE100 in the market, as the company is a key supplier of this PE grade.
Despite the stable operation of Gazprom Neftekhim Salavat in September, the lack of supply of natural PE100 in the first month of autumn continued to be felt in the Russian market.
The deferred demand in August and the absence of a similar polyethylene offer by Nizhnekamskneftekhim have kept a small deficit on the market.
Prices for natural PE 100 in late September increased to Rb98,000-100,000/tonne FCA (free carrier), including VAT.
Prices for film HDPE have grown dynamically since August, with prices for some items exceeding the level of Rb100,000/tonne FCA, including VAT.
The growth dynamics of film HDPE prices slowed in September, and by the end of the month the maximum price reached the level of Rb108,000/tonne FCA, including VAT.
Part of the situation in the film polyethylene market was saved by a serious increase in the volume of imports from Uzbekistan and Ukraine, and the shutdown of Stavrolen and Kazanorgsintez did not affect prices significantly. The markets of injection moulding and blow moulding HDPE reacted relatively calmly to the September shutdowns of the two plants. Sufficient stocks of both producers and traders helped to keep prices from sharp growth. MRC, a partner of ICIS, produces polymers news and pricing reports from Russia, Ukraine, Belarus, Uzbekistan and Kazakhstan.