MOSCOW (MRC)--Increased polypropylene (PP) supply caused prices to fall in the Russian market in the second half of April, according to the ICIS-MRC Price Report.
Weak demand and lower prices in the foreign markets spurred the downtrend of PP prices, although not all sellers adjusted their prices.
The first three months of the year were quite difficult for Russian converters due to a lack of supply, and prices growing almost weekly under the pressure of the situation in the foreign markets.
The supply of PP from some producers increased in April, and the pressure on prices from export markets also eased.
From the middle of April PP in Russia began to gradually fall in price, and this process accelerated for some products in May, but not all sellers agreed to adjust their PP prices.
Demand for PP has decreased significantly in May, under pressure from both the long May holidays and the high costs, which many converters with delay and difficulties shifted to the cost of finished products.
Due to a lack of working capital and a decrease in demand for finished products, some converters reduced capacity utilisation rates.
The Turkish market had acted as a driver of Russian PP prices in the first three months of 2021, but the situation there changed dramatically in April.
Some Russian companies began to receive offers for PP supplies from Asia, including China.
Low demand for PP from converters and sufficient supply, including imports for some types, led to a further decrease in prices.
April prices for homopolymer PP were assessed at Rb170,000/tonne CPT Moscow, including VAT at a number of sellers.
At the end of May, some sellers dropped their prices below the level of Rb160,000 - 165,000/tonne CPT Moscow, including VAT, depending on the type of homopolymer PP.
MRC, a partner of ICIS, produces polymers news and pricing reports from Russia, Ukraine, Belarus, Uzbekistan and Kazakhstan.