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August LDPE prices rose in the Russian market by more than a quarter

August 28/2020

MOSCOW (MRC) -- The Russian market saw a constant rise in low density polyethylene (LDPE) prices throughout August due to good demand and shutdowns for maintenance at some plants. The increase in prices of some grades exceeded 25% for the month, according to ICIS-MRC Price report.

The rise in LDPE prices in Russia began back in late June because of shutdowns for turnarounds at Angarsk Polymers Plant and Gazprom neftekhim Salavat. But in August, the dynamics of price growth increased significantly due to strong demand and the upcoming shutdowns for maintenance simultaneously at three plants in September. Polyethylene (PE) prices of some sellers grew by Rb20,000/tonne and more in the last summer month.

Angarsk Polymers Plant shut down its production capacities for a 30-day turnaround on 22 June, however, the plant had managed to resume its PE production after maintenance only by 3 August, and PE production was again taken-off stream on 10 August due to problems at the ethylene unit. The producer has not resumed its LDPE production so far.

A similar situation occurred with Gazprom neftekhim Salavat, the shutdown started on 1 July and was also planned to be conducted during the month, but the resumption of LDPE production started only 10 days after the scheduled date. At the same time, Salavat PE was virtually completely absent in the spot market in the second half of August.

It is also worth noting that Kazanorgsintez reduced its LDPE output in August due to a shortage of ethylene.

Many sellers limited their sales in the spot market throughout August, and prices were also adjusted on a weekly basis. In the contract market, consumers reported restrictions from producers. As a result, many converters were unable to build up additional LDPE inventories.

But September will be the most difficult month for consumers because of a series of shutdowns for maintenance at three more plants. Ufaorgsintez will be the first to start gradually shutting down its production for a turnaround from 29 August, the maintenance works are scheduled to be fully completed by 6 October.

Tomskneftekhim intends to shut down its production capacities for a two-week turnaround in early September. Kazanorgsintez will shut down its production capacities in several phases from 17 September, the outage will last until 10 October.

In late July, prices for 108 grade PE started from Rb74,500/tonne CPT Moscow, including VAT, and offer prices for 158 grade LDPE were at an average of Rb76,500/tonne CPT Moscow, including VAT. In late August, prices rose to Rb95,000/tonne CPT Moscow, including VAT, and Rb100,000/tonne CPT Moscow, including VAT, respectively.
Author:Margaret Volkova
Tags:PE, LDPE, ethylene, Gazprom neftekhim Salavat, Tomskneftekhim, Angarsk Polymers Plant, Kazanorgsintez, Ufaorgsyntez, Russia.
Category:General News
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