MOSCOW (MRC) -- There was a shortage in the Ukrainian film grade high density polyethylene (HDPE) market in the second half of August. At the same time, limited working capital of converters keeps prices down in the market, according to ICIS-MRC Price report.
Demand for polyethylene (PE), including film grade HDPE, subsided in the Ukrainian market in August. At the same time, there was a major shortage of supply in the second half of the month, despite weaker demand. Most converters experienced a serious lack of working capital because of a great devaluation of the national currency, which was one of factors that keep prices down.
Tight supply of film grade HDPE in the Ukrainian market was caused by reduced shipments from Europe and Russia. A trader said that it managed to contract European PE this month half as much as in July because of limited export quotas. Shipments from Russia were completely cancelled in August on the back of a shortage in the domestic market.
Tight supply of film grade HDPE is of a temporary nature. Sufficient PE quantities from the Middle East are expected to enter the market in the coming weeks. Some companies said they had fully switched over to purchasing PE in Saudi Arabia because of a shortage in Europe and Russia.
Deals for film grade HDPE remained unchanged in dollars this week and were done in the range of USD2,250-2,300/tonne FCA, including VAT (prices were calculated in the local currency at the interbank exchange rate at the time of payment).
MRC