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Rusian prices of pipe HDPE increased in August

August 08/2012

MOSCOW (MRC) -- A tightened supply of pipe polyethylene and surge in buying activity resulted in the price increase in the market. The availability of pipe HDPE is unlikely to improve in the nearest two months, according to MRC analysts.

The demand for pipe PE was seriously cut in H1 2012 due to cold winter and low investments from the Russian State. High competition in the market of ready pipes made local producers buy the polyethylene under the current needs, which limited the growth of feedstock prices.

In July, the demand for pipe polyethylene grew in the Russian market. At the same time Kazanorgsintez had to limit production of cloloured PE100 because of mechanical problems. However, despite these factors, many local makers of plastic pipes did not hurry to form additional inventories of feedstock.

August is the last month before the scheduled turnarounds of Kazanorgsintez and Nizhnekamskneftekhim. Local producers of pipes on oncoming increase in demand for finished products and turnarounds of major producers began actively replenishing their inventories. The limited supply of pipe PE and increased demand led to a small deficit in the market and price increase. As Russian producers expectedly have announced an increase in contract prices of pipe polyethylene for delivery in August.

The price quotations of the Russian coloured PE100 rose to Rb70,000-71,000/tonne, including VAT and delivery to the central part of RF. There were no offers of Asian and European black PE100 in the spot market.

In the next few months, the situation in the Russian market of coloured pipe PE100 is unlikely to change. The offers of the Russian material will be limited due to the upcoming stops on turnarounds. European makers have already sold almost all of their quotas for August, some market participants have reported they managed to contract  PE only for September. Asian producers also sold all their August quotas for pipe PE yet in July.
Author:Anna Larionova
Tags:PE, LDPE, HDPE, Kazanorhsyntez, Nizhnekamskneftechem.
Category:General News
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