July is traditionally difficult month for Russian LDPE buyers. The market was seriously affected in June by maintenance works at Gazprom neftekhim Salavat and Tomskneftekhim, as well as reduced capacity utilisation at Kazanorgsintez this year because of ethylene shortage.

 

As a consequence, LDPE supply was significantly tight, with price offers exceeded Rb76,000/tonne. Deals for LDPE in the spot market reduced a minimum in the late July because of tight supply. Price offers for 158 PE reached Rb76,000-76,500/tonne FCA, including VAT. LDPE prices for shrinkable films production reached Rb77,000/tonne FCA, including VAT.

 

Tomskneftekhim announced an increase in PE prices this week of Rb1,000/tonne. Ufaorgsintez will announce its contract LDPE prices for the first half of August delivery this week. 

 

The availability of LDPE in Russia will improve not earlier than in October.

 

Angarsk Polymers Plant  has also shut its PE capacities for scheduled maintenance, although this producer is mostly export-oriented, the shortage of the producer"s PE in some regions will be offset by the material from other local plants. 

 

Ufaorgsintez will shut its capacities for a month long turnaround, which will go in two stages, on 15, August. 

 

Kazanorgsintez will shut its LDPE capacities for two weeks maintenances in the second half of September. 

 

These factors (maintenance works) will result in a certain shortage of LDPE in the Russian market in the next couple of months.