Kazanorgsintez, the largest Russian HDPE producer, intends to finish its maintenance works in the first decade of October. Scheduled maintenance works at the producer"s HDPE production usually led to a shortage of the material in the market, resulting in a price rise. 

 

The current year will be no exception, as the situation worsens by the shutdown of Stavrolen. The shutdown of the second largest HDPE producer in Russia - Stavrolen has already led to a serious increase in the price of all PE grades in the market. 

 

The biggest shortage is felt in the market of blow moulding and injection moulding HDPE. Price offers for above said PE grades are practically absent in the market, with small volumes of stocks left reaching Rb95,000/tonne FCA, FCA, including VAT.

 

Traders have offered imported blow moulding and injection moulding HDPE in the spot market, in particular Middle Eastern material. Price offers for Middle Eastern blow moulding and injection moulding HDPE were heard in the range Rb86,000-88,000/tonne FCA, including VAT.

 

At the same time, in spite of such a serious difference in price with the Russian polyethylene, many local converters do not rush to buy imported HDPE. The market of film HDPE is excessive at the moment due to to a steady supply of material from the Kazanorgsintez and Nizhnekamskneftekhim. The low end of the price in the beginning of the month was at Rb82,500/tonne FCA, including VAT. 

 

But in the next two weeks, the situation can radically change. Kazanorgsintez is to shut its HDPE capacities; Nizhnekamskneftekhim will reduce production rates at its HDPE capacities because of the scheduled maintenances at the production of ethylene, moreover the producer switches to linear low density polyethylene (LLDPE) production from October for a month. 

 

In general, taking into account the plans of Russian producers over the next two months, he market faces inevitable shortage of injection moulding HDPE. Both producers are not going to produce it until November.

 

Supply of blow moulding HDPE will be also tight to mid October because of the turnaround at Kazanorgsintez. There can be some shortage felt in film HDPE market; however, demand for it seasonally decreases, besides some traders plan to deliver significant volumes of Middle Eastern material in October.