South Africa PE, PP business fails to improve after holidays

14 May 2014 16:55 Source:ICIS News

LONDON (ICIS)--Despite expectations of polyethylene (PE) and polypropylene (PP) business in the South African market improving after recent public holidays and last week’s general election, the market remains subdued, participants said this week.

“Last week we had the [general] election,” a PE distributor said. “This week, it’s [the market] not exactly fireworks. It’s quiet, subdued.”

A distributor of high density PE (HDPE) and PP agreed: “It’s very quiet indeed, although [there’s] some interest in emergency parcels of PP and HDPE.”

According to a trader, the outlook for the market is not promising because of various factors affecting the country’s economy.

“Demand is OK, but not great,” this source said. “The economy is forecast to be under pressure by some major banks for the next two years as a result of an increase in wages, electricity [prices], and fuel [prices].”

he trader added that strikes in the mining sector and the exchange rate devaluation are also having a negative impact on the economy.

By Jo Pitches