Indian polymer demand continues to fall amid lockdown
Indian polymer demand is continuing to fall as the country approaches its second week of a 21-day lockdown to stem its coronavirus outbreak.
Authorities are allowing deliveries of raw materials for the production of essential goods. But truck deliveries of polypropylene (PP) to converters' warehouses are coming to a halt because of travel restrictions applied since the 25 March lockdown started. Logistics companies also face a shortage of truck drivers. PP is widely used in India in the packaging of food such as rice, flour and sugar.
Domestic PP producers unable to deliver PP resins have been left with little choice but to cut operating rates or shut their plants because of rising inventories.
India's state-controlled MRPL shut its 440,000 t/yr PP plant at Mangalore on the west coast after last week's lockdown. Fellow state-controlled refiner IOC has also shut its 700,000 t/yr PP plant at Paradip in east India, which started up in phases last year.
PP raffia prices on 26 March fell by $10/t from a week earlier at $880-920/t cfr, Argus data showed.
Polyethylene (PE) producers face similar transportation restrictions and a slowdown in domestic trade.
India's state-controlled Opal is reducing operating rates at its high-density polyethylene (HDPE) and linear low-density polyethylene (LLDPE) production lines. Opal has a 1.1mn t/yr cracker at Dahej in west India's Gujarat state.
Indian private-sector refiner Reliance Industries is currently maintaining operations at its PE units in Gujarat.
LLDPE film prices in India were $790-830/t cfr on 26 March, down by $10/t from the previous week, according to Argus data.
A freefall in Asia ethylene values, a bearish factor, is limiting spot trade in the country.
Ethylene spot prices in northeast Asia yesterday fell to an 11-year low at $450-500/t cfr northeast Asia, $50-60/t lower than Argus assessed prices on 25 March.
By Muhamad Fadhil and Yee Ying Ang
source: Argus Media
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