Reducing Base Prices Would Further Boost the Iranian Market for Polymers

Today, Sun. Feb. 24th 2019, the PDID Office of NPC announced the basic prices of polymer and chemical materials for a week, starting from today. With the US$ exchange value dropping, most of the polymeric materials were priced down, though, several commodities also recorded a slight increase.

Last week (Click Here), despite the jump in prices, the trading volume continued its thriving trend. More than 80,000 tons of polymers was the trade volume capacity at stock exchange, which, with a slight overstatement, was a record breaking in this year. Also, registering of 117,000 tons of demand showed the tendency for the Iranian market and downstream industries to buy. Probably liquidity shortage and, of course, lack of supply to this extent, did not make this demand possible.
However, the polymer market seems to be in a state of equilibrium. Now, with the announcement of new base prices, it seems that this week, the situation of polymer transactions is even more interesting. This week, the US$ discovery value for base price calculations (Rls. 86,050) dropped by one percent, which led to a decline in base prices in most polymer groups.
Incremental side:
The base price increase affected only four commodities. Of course, this increase was negligible, especially for polypropylene.
HDPE extrusion type (PE100) increased only by 1.5% reaching to Rls. 89,057.
At the 2nd row, the price of ABS 0150 by 1% increase in base price changed to Rls. 119,501.
Textile PP by 0.9% price rise was the 3rd polymer at the incremental side. The price of this polymer suffering Rls. 760 changed to Rls. 88,113/Kg.
The fourth highest price increase was recorded for PP. Although the base price growth of 0.7% does not appear to be significant enough, however, considering the present market conditions, which has been critical for last three weeks for PP, this slight increase would mean more critical situation unless the supply of this commodity will increase by petrochemical industries.

The following table shows the total trade volume for last week (Feb.16th-22nd) at the IME hall in 177 times of deals. All prices are in Iranian Rials based on the US$ value 1 US$= 86,550.