Iran Polymer Trade Volume Will Boom in Coming Weeks
Two weeks ago the PDID office of NPC determined the new base prices for polymers for the weeks ending to Oct. 8th. However, in a sudden increase in the foreign currency markets, the prices started to raise today from the early noon till afternoon. Some polymers like HDPE Blowing 0035 experienced a higher than expected increase with about 30 cents/Kg, and other even faced with half a US$ increase, LLDPE was among the happy materials! The following analysis shows the high slope increase and its reasons.
Though today, on Saturday, October 7th, the market started with stable prices for US$ (39480 Rials) and a slight decrease in the price of the Euro (47150 Rials with 10 Rials decrease) and while decreasing the price of gold coins by about 10 cents (1213200 Rials with 3920 Rials) were showing a calm market, but suddenly from around noon, with the onset of rising foreign currency prices, and indeed with a sharp increase in the price of the dollar (39600 rials with a rise of 120 rials), the rise in prices for polymers also started, and until today afternoon, an unrelenting race against converters of the plastic products in Iran was in progress. At the same time, the price of the blowing and film grade polymers started to increase steadily from around 11 am.
This increase continued for about a few hours on the main market, and with the increase of US dollar up to 39640 Rials (for sale) and the rise in the price of most valid currencies, it created a rich market for dealers and traders of polymer materials. Some kinds of HD polyethylene materials up to the limit of 1100 Rials (Blowing 0035) and LLDPE up to 2200 Rls. border and the remaining materials experienced an increase of 20 to 180 Toomans. However, due to the holidays of Tasooa and Ashura, the PDID Office of NPC did not have a meeting on the base rate of the polymers, and had already set the base price for the two weeks prior to Sunday 8th of October. As a result of the distortion of market rates from the base prices and the setting of new rates at noon tomorrow, the producers who have an emergency purchase will have to bear rising prices.
Price increasing, both in the free market and by the price council, is what that every experts can foresee for tomorrow onward.
Meanwhile, today the official website of the National Petrochemical Company, said this site in an analysis of the optimism of the relevant expert for the boom in the next coming weeks. Some of this is quoted from the petrochemical website (NIPNA):
Reducing trading volumes along with falling prices in the petrochemical market has created difficult conditions that aggravate concerns about the creation of a seasonal recession, and the suppliers’ support in commodity exchanges seems to be able to overcome a significant part of these difficulties.
Last week, the volume of traded polymers on the stock exchange was down, and maybe this volume fell to the lowest level since the beginning of July. Last week, the volume of the trade of polymers fell by more than 13.5 percent, recording a record 43,750 tons, indicating that this volume, the level of stagnation and boom this year (50,000 tons of polyester traded goods per week) was broken and the market entered a new recession phase has taken place.
While supply volumes did not change much, demand declined by more than 22 percent, indicating a weak demand for the market. Falling prices in the open market, downsizing of buyers in downstream industries, reducing the volume of trading activity in the domestic market, market impact from the two closing days of the last week and the mildness of activities along with the weakness of liquidity were cases that eventually weakened the market and reducing trading volume on stock exchanges.