September is traditionally one of the hardest months of the year for Russian producers of polyethylene pipes. The main reason is a planned stop at the prevention of major polyethylene producer Kazanorgsintez. The current year besides the serious deficiency is characterized by a record level of prices. So, on the spot market price of natural PE100 exceeded the level of 120 thousand rubles. per ton.

A disadvantage of polyethylene pipe on the market began to take shape in August, in September the deficit increased significantly. As reported by many market participants, black HDPE pipe production of Kazanorgsintez and Nizhnekamskneftekhim was actually painted by contractual customers on the spot market for the material missed. Contract prices rose 4 000-7 000 RUB. per ton in comparison with the August level.

On the spot only in the middle of September there were proposals to supply natural HDPE pipe from the side of Nizhnekamskneftekhim. In most cases the deal on the supply of Nizhnekamsk polyethylene was in the range of 120 000-125 500 rubles. per tonne with VAT, FCA Nizhnekamsk. In some cases, transactions reached the level of 130 000 rubles. per tonne with VAT, FCA, and above.

Last week there were proposals to supply natural HDPE pipe from outside “Gazprom Neftekhim Salavat”. The transaction was launched with a mark of 120 thousand rubles. per tonne with VAT, FCA.

However, despite starting the supply pipe HDPE by Nizhnekamskneftekhim and “Gazprom Neftekhim Salavat” in the second half of September, many pipe producers are unable to replenish their inventories and are forced to temporarily suspend its work.

Alternative to Russian pipe HDPE for local processors actually completely absent. In Europe from local producers export quotas are limited, while the cost of European raw materials taking into account the current rate is approaching the level of 140 thousand rubles. per ton, including VAT and delivery. In Asia, the export price level of PE pipe is significantly lower, however, due to logistics long delivery times constitute not less than 35 days, which is irrelevant for Russian processors in view of the approaching winter.

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