MOSCOW (MRC) -- Negotiations over December prices of high density polyethylene (HDPE) began in Russia late last week. Some sellers announced a price increase of Rb5,000/tonne, and others intend to maintain their prices at the level as of the second half of November, according to ICIS-MRC Price report.
HDPE supply has been increasing gradually in the Russian market after the end of the producers' shutdowns for maintenance and higher capacity utilisation. But there has been no need to talk about an oversupply so far. Moreover, the devaluation of the rouble against the dollar significantly reduced the ability to increase imports. As a result, some sellers rolled over their polyethylene (PE) prices as of the second half of November for December deliveries, and in some cases, buyers even reported a price rise of Rb5,000/tonne.
Gazprom neftekhim Salavat and Kazanorgsintez finished their turnarounds in September-October. By the third decade of November, Stavrolen had resumed its HDPE production with the annual capacity of 300,000 tonnes after a long shutdown for maintenance. Thus, the period of this year's scheduled shutdowns for repairs at Russian plants came to an end.
Supply of PE has been increasing gradually in the market, and demand has been subsiding in some consumption segments due to seasonal factors. In addition, record high prices have been putting a major pressure on demand for the past few months.
This year's HDPE imports are 20% lower than last year. Some market participants reported a slight increase in imports from Iran. But the current devaluation of the rouble against the dollar blocks all the prospects for the growth of HDPE imports.
In the spot market, some sellers announced their December offer prices for film grade HDPE in the range of Rb150,000-156,000/tonne, including VAT and delivery. The spread of blow moulding PE prices was wider and ranged between Rb150,000-167,000/tonne FCA, including VAT and delivery.