Russia PP prices soar in the first week of September
Sergey Karaichentsev
12-Sep-2017
MOSCOW (MRC)–Scheduled and unscheduled outages at local
plants led to an acute shortage of polymer in the market and
to a major price increase, according to ICIS-MRC’s Price
report.
Supply of PP was tight from some producers
in the Russian market back in the second half of
August.
The market situation deteriorated sharply in the first week
of September because of the shutdowns at three plants: SIBUR
Tobolk, Stavrolen and Ufaorgsintez.
The shortage of PP amid strong demand led to a sharp and
significant rise in prices of both propylene homopolymers
(homopolymer PP) and propylene copolymers.
In early September SIBUR Tobolsk, Russia’s
largest producer (with the annual capacity of 500,000
tonnes), took some of its PP production capacities offstream
due to technical issues. The exact dates of the outage have
not been announced yet.
Since 6 September, Stavrolen – with an
annual capacity of 120,000 tonnes – began a scheduled
shutdown for about a two-week turnaround. Ufaorgsintez (with
the annual capacity of 120,000 tonnes) plans a 12-day
maintenance from 11 September.
While the shutdowns in Budennovsk and Ufa
were planned, the outage at some production capacities in
Tobolsk was a complete surprise for the market. Back in July,
there was a surplus in the PP market, the market balance
began to change in August, and many converters simply did not
have time to build up additional inventories.
Last week, many sellers suspended or
restricted their PP sales because they had scarce stocks, as
a result, there were very few deals for homopolymer
PP concluded. And in some cases, offer
prices reached Rb88,000/tonne FCA, including VAT, for
homopolymer PP raffia.
The propylene copolymers market responded
following the homopolymer PP market. Deals
for September shipments of Nizhnekamskneftekhim’s propylene
copolymers reached Rb98,000/tonne FCA, including VAT, in the
electronic trades, whereas they were in the range of
Rb90,000-92,000/tonne FCA, including VAT, in late
August.
MRC, a partner of ICIS,
produces polymers news and pricing reports from Russia,
Ukraine, Belarus, Uzbekistan and Kazakhstan.
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