LONDON (ICIS)--The recount of Istanbul votes from last weekend's municipal election has delayed market players' response to the new April polyethylene (PE) and polypropylene (PP) offers.A polling station in Batman, southeast Turkey, 31 March. Source: Metin Yoksu/Depo Photos via ZUMA Wire/REX/Shutterstock
At the moment, most players are less concerned about the fluctuating value of the Turkish lira (TL) against the dollar, focusing instead on the results of the election.
At the start of 2019, the lira was trading at $1:TL5.29. By the end of March, the currency nearly fell to $1:TL6, although it recovered slightly afterwards.
By Friday, after a volatile week following the local elections, it was trading at $1:TL5.60.
Turkish PE prices moved as sentiment generally firmed in the week.
Achievable prices in the market have risen for some grades, especially as US offers have increased, being currently the most competitive, which usually affects the low end of product from other regions.
PP prices were flat after increasing over recent months on shortages prior to the latest hikes. PP prices in Turkey already offer some of the most attractive netbacks in the region.
Middle Eastern offers were increased on upstream costs and some limited availability in the that region following production hiccups and slowdowns.
It is unclear if suppliers will be able to achieve all of their proposed increases.
If the lira falls it could affect buyer confidence, but many players are expecting it to stabilise and hope buying interest will return following the completion of vote count.
The ample availability of PE supplies may prevent realisation of full price increases. If the economy picks up speed, prices are likely to rise.
Lack of availability may lead buyers to accept price increases over current levels for PP, however.
Iranian offers will return to market next week.
There are fewer production issues in the Middle East at the moment, but it will take time to ease shortages across Turkey, especially because most players have avoided building up stocks in recent months.
PE is the most widely used plastic in the world, primarily found in packaging including plastic bags, plastic films and geomembranes.
PP is used for packaging, ropes, carpets, plastic parts, loudspeakers and automotive parts.
Focus article by Ben Lake