MOSCOW (MRC) -- Imports of polyethylene (PE) into Kazakhstan fell over the first five months of 2014 by 27% year on year. High density polyethylene (HDPE) accounted for the main reduction in imports from local pipes producers, reported MRC analysts.
There was a slight increase in PE imports to Kazakhstan in May after a drop in April. PE imports rose to 6,800 tonnes from 6,200 tonnes a month earlier. The overall imports of polymers of ethylene to the local market slumped to 34,500 tonnes from January to May 2014 versus 46,900 tonnes in the same period of 2013. Demand for PE from local pipes producers subsided significantly.
The structure of PE imports by grades looks the following way over the stated period.
May HDPE imports rose to 5,500 tonnes (3,900 tonnes in April) because of increased supplies from Russia. The overall HDPE imports to Kazakhstan fell to 25,100 tonnes over first five months of the year from 39,500 tonnes in the same period of 2013. Pipes producers accounted for more than 80% of the total HDPE consumption in Kazakhstan.
Weaker demand from local pipes producers was caused by several factors: the end of the regime of preferential imports (a preferential regime of pipe grade HDPE imports was in force up to 1 January 2014, when pipes producers could have imported material without paying an import duty), the February devaluation of the national currency by 20% and reduced investment into infrastructure by the state.
May imports of low density polyethylene (LDPE) dropped to 1,100 tonnes (1,800 tonnes in April) because of the reduced supplies from Russia (a scheduled outage for maintenance at Kazanorgsintez). The overall LDPE imports to Kazakhstan totalled about 7,600 tonnes from January to May 2014 versus 5,700 tonnes in the same period of 2013. Russian producers with the share of over 92% in the total 2014 imports are the key LDPE suppliers.
May imports of linear low density polyethylene (LLDPE) fell to 316 tonnes (510 tonnes in April). The overall LLDPE imports to Kazakhstan virtually remained at the last year's level over the first five months of 2014 and totalled about 1,700 tonnes. Producers from Asia and Uzbekistan are the key PE suppliers to the republic.
MRC