PP, PE prices hiked by Chinese producers on unsatisfactory margins

(plastemart) -- Domestic PP and PE prices moved higher in China this week as producers in China lifted their prices in an effort to restore their lost margins.

Demand remains disappointing inside China as economic growth continues to moderate in the world's second largest economy, but producers commented that they are insisting on their new price levels as they cannot maintain satisfactory margins at their previous prices. China's import PP and PE markets were quiet this week as overseas producers wait in the sidelines while deciding on their April pricing policies. Traders generally left their offers steady on the week, commenting that the market is balanced between high upstream costs and lackluster demand.

"We have had no choice but to raise our PP prices as our margins had fallen into negative territory following the recent significant increases in upstream costs," a source at a domestic producer told.

A converter in the home appliance sector concurred, "Prices firmed up a bit this week. We are planning to purchase a small amount of material to keep our production going but will search the market for attractive prices before making any purchases. We plan to offer strong resistance to any further price hike attempts." "Our sales are disappointing these days but we will not agree to any discounts on our prices as we need to achieve the full extent of our price increases in order to repair our margins," reported a source at a domestic PE producer.

A distributor followed saying, "We are feeling more confident about the market outlook given producers' firm stance on prices. We are limiting our sales volumes for now as we feel that we will have to replenish at higher costs once we sell out our remaining stocks." A converter confirmed the demand situation noting, "We are not interested in making any purchases for now as we feel that we will not be able to pass our rising raw material costs onto our end product prices. We are skeptical as to the medium-term feasibility of the recent price hikes."

MRC

(plasticker) -- Specialty chemicals company Lanxess AG is to increase its prices in Europe, the Middle East and Africa for Durethan base resin, film and extrusion grades by Euro 0.13 per kilogram effective March 15, 2012. This price adjustment is due to significantly higher raw material and energy costs.

The relevant grades of the high-performance plastic Durethan are mainly used for the production of food packaging, industrial films, monofilaments and semi-finished products as well as a raw material for compounds.

The Semi-Crystalline Products business unit belongs to the Performance Polymers segment, which achieved sales of EUR 3.8 billion in 2010.

MRC

MOSCOW (MRC) -- In February, Russian producers of polypropylene left capacity utilization at rollover from the January. The total volume of polypropylene production made slightly more than 48,000 tonnes, according to MRC SkanPlast.

Last month, Russian producers of polypropylene left the capacity utilization at rollover from the January. The total production of polypropylene made 48,140 tonnes. In January, this figure was 48,650 tonnes. In February, Russian producers reduced the production of raffia and switched to the injection moulding grades of homopolymer of propylene. Volumes of production of propylene copolymers also decreased.

This year, three Russian producers increased the level of capacity utilization. The volume of polypropylene production at Ufaorgsyntez grew by 29% due to the use of external supplies of feedstock. Tomskneftekhim and Petrochemicals did not increase production so significantly: by 9% and 2%, respectively.

Over the weekend, the third largest Russian producer of polypropylene Stavrolen began working on a shortened schedule. Earlier this week, there were produced first lots of the injection moulding polypropylene, but the company still does not force the events. The shipments of polypropylene in the domestic market are not underway yet .

Because of the accident on December 15, 2011 at the gas distribution unit, company had to switch to imported propylene, which affects the level of capacity utilization.
At the end of the second quarter a new production at the Polyom site in Omsk is expected to be launched with a capacity of 120,000 tonnes per year on technology of LyondellBasell.

MRC

Total U.S. production of PET film in the last two years has been running around 430 to 435 million pounds per
year. Almost that much-423 million pounds-was imported into the United States in 2010, according to data from
the U.S. International Trade Commission (ITC).

MRC

(chemmonitor) -- Asia-based polypropylene (PP) sellers do not seem to actively trade with Europe users. This is due to constant fluctuations observed in the market for oil.

Europe values adopted an uptrend this year on the back of rising costs for raw materials as well as the consumption growth. They increased by approximately one third from the end-2011 level.

Asia prices also moved higher in the existing month, following a series of decreases a month ago.
MRC