Indian PE Importers Cautious Amid Duty Deadline and Forex Volatility

Indian polyethylene (PE) importers are approaching the market with caution as they face the impending expiry of a duty waiver on June 30 and ongoing volatility in the Indian rupee. Despite these challenges, the supply of PE has remained stable following the restart of operations at Gail Pata. However, demand from converters remains low.

In contrast, the polypropylene (PP) market is experiencing tighter supply conditions due to government feedstock diversion, which has increased import demand. Competitive offers from Thailand and Vietnam are contributing to this trend. Current market prices indicate a moderation in linear low-density polyethylene (LLDPE) and low-density polyethylene (LDPE), with prices ranging from $1,250 to $1,330 per tonne for LLDPE and $1,500 to $1,600 per tonne for LDPE. Meanwhile, domestic PP prices have risen by Rs6/kg, with import prices ranging from $1,250 to $1,310 per tonne.

In the broader context, the global PE market is also influenced by supply disruptions in Saudi Arabia, where PetroRabigh has faced an 8% cut in ethane gas supply and a 12.5% reduction in crude oil supply following attacks on the country's oil facilities. This has led to potential impacts on PE production, although PetroRabigh has not confirmed any output reductions. The company is expected to prioritize domestic sales amidst these challenges.