MOSCOW (MRC) -- Consumption of bottled grade polycarbonate (PC) in the Russian market fell by 77% in Q1 2015 to only 156 tonnes versus 674 tonnes over the same period 2014, according to MRC ScanPlast.
Imports of bottle grade PC to the Russian market have decreased sharply since November 2014 because of the national currency devaluation. The market turned out not to be ready for domestic prices of Asian material, purchased for dollars in the sport market. Consequently, imports were suspended in the short run. Traders still could not sell out the purchased material since last autumn. Many converters switched to recycled material, some converters suspended operations. And buyers used bottles much longer than their appointed term for reasons of economy. Only purchasing of bottle grade PC by converters that buy material for their production directly from the European producer was stable.
As for traders, the lot of European PC granules, purchase prices of which were much lower than prices of Asian material, entered the market in late 2014. The currently available residues of both European and Asian material should suffice until late April on the back of lower purchasing power of the market. Shimpents are expected to be resumed in May.
The supply structure of bottle grade PC to the market largely depends on the exchange rate. With its recent strengthening, prices of imported material fell significantly. However, it is difficult ot anticipate the further development of the situation. Traders that do not work on prepayment basis do not want to assume currency risks.
At the same time, the dollar has appreciated significantly against other currencies in world markets. In addition, Asian producers began to raise their prices again after the recent price drop because of the higher oil and feedstocks prices. Therefore, the bottle grade PC market, earlier dependant on Asian PC shipments, is likely to switch to European material.
MRC