Recession Could Be Expected in Iran Polymer Market Due to Base Price Increase

After two weeks, today, Sunday, Feb. 17th. 2019, the PDID office of NCP announced the new base prices for polymer and chemical materials.

According to the Plastic Industry Magazine website (PIME) after wondering change of the method for the evaluation of the US$ price in the market, the market for last couple of days remained almost static due to the ambiguity in determining the US$ value for this week.

If the PDID office was to operate according to its last weeks trend of US$ evaluation the prices should have been risen by 16%, however they decided to account for only 4.8% increase in US$ value for the calculation of the base prices, and so, the official price of the US$ reached to Rls. 86,915. Of course this was not the only indicator for the increasing of the prices of all polymers. In fact, the PDID also considered the global prices and as a result the polymers base prices increased totally and for some commodities even more than 4.8% (compare with two weeks ago).
Highest price increases:
The PET bottle group was up by 7% base price over the past two weeks. This led to the Rls. 7,800 increase in the base price of PET that could be a motivation for market manipulators. Normally and due to higher demands for next two seasons (spring and summer) it is common for speculators to start purchasing and storing for selling it in higher price. This means that PET should be an attractive material for this week in competitions.
The EPS group was the second material group which recorded a higher price increase by 6.9%. Its base price announced for Rs. 101,559 for grades 200 and 300 and Rls. 98,630 for EPS 400. A high competition on purchasing these material is not expected yet.

The third highest-growth in price commodity was the extrusion grade of PE 80, which experienced 6.2% increase in its last announced base price. This commodity is priced Rls. 85,967.

Obviously due to last week’s holidays for the 40th anniversary of the Islamic revolution, the number of deals has fallen about 30% in the number of purchasing bids.

The following table shows the total trade volume for last week (Feb.10-15th) at the IME hall in 156 times of deals. All prices are in Iranian Rials.

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