Prices for January cargoes of PE, PP expected to drop in Indian spot market as Indian rupee continues to slide against U.S. dollar; average LDPE prices at US$1,380/tonne CFR Mumbai week ending Dec. 16, down US$5/tonne week-over-week
December 19, 2011
– Prices for January shipments of polyethylene and polypropylene are expected to drop, as traders are reluctant to stockpile either material while the Indian rupee continues to depreciate, ICIS news reported Dec. 19, citing industry sources.
Average low-density PE spot prices were at US$1,380 per tonne cost and freight Mumbai at the close of trading last week, reflecting a $5/tonne decrease from the week before. Linear low-density PE closed down $25/tonne to settle at $1,250/tonne CFR Mumbai while high-density PE closed down $5 to $1,315/tonne.
Meanwhile, average spot prices for polypropylene raffia were also down, dropping $25/tonne week-over-week to $1,340/tonne CFR Mumbai.
The declines in polymer prices are attributable to a rupee that has been declining sharply against the U.S. dollar. On Dec. 15, the country's currency dropped to a record low of 54.30 Indian rupees to one U.S. dollar, down 18% from July on concerns of India's slowing economy.
The depreciating rupee has forced buyers to turn to domestic producers for product, ICIS reported.
The primary source of this article is ICIS news, Sutton, England, Dec. 19, 2011.