Egypt’s local PE market suffers limited availability
In Egypt, players in the PE market complain about tightness in local supplies especially for HDPE film, HDPE injection and LDPE film, as per the pricing service of ChemOrbis. Local producer SIDPEC’s HDPE film deliveries are disrupted as they are still running their line for HDPE blow moulding. Meanwhile, for injection grade, the producer had reported at the beginning of December 2012 that they would not have any high MI HDPE injection availability until the end of the year. There have been no updates regarding SIDPEC’s HDPE injection production by the time of publishing.
The producer started the month of January with EGP850-950/ton ($130-146) hikes. Players voice their complaints about the locally held supplies although overall demand inside the country continues to perform weakly given the ongoing economic woes and political instability. Plus, the increasing dollar parity hampers the purchasing power.
A trader commented, “Players complain about SIDPEC’s HDPE film deliveries as they still have not received any cargoes from the producer although SIDPEC should have already switched their production line to HDPE film.” In response to these complaints, a source from SIDPEC cited at the end of last week, “We are still running our HDPE blow moulding line. We believe that it might take a couple more days to switch our line to HDPE film. If we cannot switch by the end of the week, the next probable switch date might be Tuesday.”
Due to lack of materials, some converters were reported to have shut down their plants while some elected to stop their production since they struggle to afford higher prices caused by the higher dollar parity and supply issues. Apart from these, some distributors were reported to be holding onto their existing stocks as they cannot be sure of the market situation amidst volatile economic conditions. A converter told ChemOrbis, “Our end product demand performs normally but given the current economic situation in the country and the constantly increasing prices, buyers in general do not want to commit to fresh cargoes.
They hesitate about the future direction and therefore, they prefer to hold onto their cash stocks. Most purchases are done on needs only basis at the moment while prices record almost daily increases amidst tight supplies and increasing dollar parity.” Looking at the overall market levels, PE prices gained up to three digit hikes during this past week. The LDPE film market rose by EGP150-500/ton ($23-77/ton), LLDPE film by EGP400-700/ton ($61-107/ton), HDPE film by EGP350-700/ton ($54-107/ton) and HDPE blow moulding by EGP350-800/ton ($54-123/ton). Meanwhile, HDPE injection prices mostly retained their already high levels before gaining further increases of EGP100/ton ($15/ton).