Market Dynamics
PE imports to Kazakhstan fell by 27% in H1 2014
Time: 2014-07-31 Source from: www.mrcplast.com
MOSCOW (MRC) -- Imports of polyethylene (PE) into Kazakhstan fell by 27% over the first six months of 2014. Demand for high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) subsided, according to MRC DataScope report.
June PE imports to Kazakhstan grew to 7,800 tonnes on the back of the seasonal factor (6,800 tonnes in May). The overall imports of ethylene polymers to the local market dropped from January to June 2014 to 42,300 tonnes versus 57,600 tonnes over the same period of 2013. Demand for HDPE and LLDPE subsided, whereas demand for low density polyethylene (LDPE), on the contrary, increased.
The structure of PE imports by grades over the stated period looks the following way.
June HDPE imports rose to 6,400 tonnes (5,500 tonnes in May) on the back of increased imports from Russia, while shipments from other countries continued to decline. Overall, HDPE imports to Kazakhstan fell over the first six months of the year to 31,500 tonnes from 48,100 tonnes over the same period of 2013. Pipes producers accounted for more than 80% of the total HDPE consumption in Kazakhstan.
Weaker demand for HDPE in the key consumption sector- pipe extrusion - was caused by three factors this year. Firstly, the end of the regime of preferential pipe grade PE imports (0% duty for importers of pipe grade HDPE was in effect up to 1 January 2014). Currently, the import duty is 9.1%, and it will be reduced to 6.5% from September 2014. Secondly, the February 20%-devaluation of the national currency, which automatically led to a proportional increase in feedstock prices. And, thirdly, a further reduction of investments into infrastructure by the state.
Last month"s LDPE imports rose up to 1,300 tonnes (1,100 tonnes in May) on the back of increased supplies from Russia. The overall LDPE imports to Kazakhstan totalled about 8,900 tonnes from January to June 2014 versus 7,500 tonnes over the same period of 2013. Russian producers are the key LDPE suppliers, their share in the total imports rose to 92% this year.
June LLDPE imports fell to 173 tonnes (316 tonnes in May). The overall LLDPE imports to Kazakhstan dropped over the first six months of the year to 1,900 tonnes, down by 7% year on year. Producers from Asia and Uzbekistan are the key PE suppliers to the republic.