Ramadan Restrictions Added To COVID-19 To Reduce The Market Size

After about two months of addition of different problems – hands in hands – to collapse small and medium size companies (intentionally or unintentionally, not clear yet), now starting Ramadan since Sat. April 25th., has added to the existing problems and no-one (almost no one) is able to guess that what will remain after the Ramadan from the ruins of -at least- the small size companies and converting work shops.

Ramadan has always been the holey month of praying and glorious business period. Donations of foods and Halal drinks (Tea, Coffee and different juices) in disposables and free of charge, makes Ramadan the month of huge production of PS and EPS for cups and foam containers for handling cooked rice with different kind of Iranian stew.

This Ramadan seems a very different one due to pandemic of COVID-19. So far, the Government under the pressure of the Ayatollahs of Qom city has neglected the WHO safety measures and has allowed many small jobs open their shops and practically the safe distance between people has been neglected. From one hand the small and medium cities don’t care for the orders of regional police forces for mandatory safe distance between people and most places (even restaurants) are opened which means a broken chain of viral transfer, and in the other hand the Government is under pressure to open the holey places and grand masks and thumbs for the three very very special nights of the martyrdom of the first Shiaat Imam (Imam Ali). In theses three nights of mourning for the martyrdom of Imam Ali, huge people gather in mosques, great traditional houses famous for these nights, temporary mourning places made for these nights, universities at which hundreds of people shoulder by shoulder cry and ask the God to forgive their sins and guiltiness and all of these in practice means a huge production of PS cups an PS foam food containers, also a lot of payments to those who sing for the Martyr of the first Imam.

This year, both are in the shadow of the very special situation of the world. To make it more understandable let us draw an extra table for this article to compare the actions of the market (including base prices and US$ value for the last purchases of brokers and converters the days before Ramadan. As the following table shows, last year on April 28th. 2019 which was the first week of Ramadan (Click Here), in comparison with today’s figures, we can see these changes:

As it shows even the offering has been increased by 175 tons in comparison with last year, but demands has shrunk by 237 tons and trading volumes has increased only 95 tons without any competition in purchases. This together with decrease in the base prices show that there has been no welcoming by converters for the month that is a honeymoon of disposable producers.

Such a comparison may show the total face of the industry which is moving very conservatively toward production and even brokerage.

During last week, a total number of 199 tenders organized at the petrochemical hall of IME out of which there were 184 successful trading. Table III shows the first most wanted polymers that were traded at once and in one bid with a small competition.

Back to base prices which was declared by the PDID Office of NPC, as could be seen in table I, almost all prices are downward. These prices have been determined on the basis of the US$ value of Rials 138.988 which is a little more than last week’s value (Click Here). However, and irrespective of the increased official rate of US$, due to huge materials that have not been sold yet by petrochemicals, they had to keep prices declining, although very negligible with such a hope that they can irritate domestic production. Table I shows the new base prices of polymers for this week till the evening o Sat. May 2nd.

Table I: The polymers base prices for this and last weeks

Now, having a look at the comparison table for the offering, demanding and trading volumes of last two weeks may show the situation better: Table II shows this comparisons:

Table II: Last two weeks OCTv figures

Once again, we can see that not only the supply or offering, but also the demands and trading volume have shrunk at a period that usually each year was the pick point for the rest of the year.

Back to the total trading during last week (Sun. April 10th till Sta. 25th, 2020)

The last table, shows details of last week’s trading and ODTv figures.