SABIC is to increase prices for all HDPE, LDPE and LLDPE in Europe by €100/t on September 1.
"The increase is driven by a globally strong demand for polyethylene," says Jo Mastenbroek, business unit director for HDPE. "The Asian market is particularly strong and even for a European producer prices for deliveries to Asia are substantially more attractive than the current European level."
Huub Meessen, business unit director LDPE/LLDPE, adds: "With the increase we will break the old psychological barrier of €1,000/t for all polyethylenes. Due to structurally higher oil process, the new upper barrier will be closer to €1,200/t. Currently, C2-monomer is short worldwide and in Europe. Prices are such that today it is more attractive to stop polyethylene production and sell the monomer instead."
Jo Mastenbroek concludes: "These increases are only a first step to bring margins back to an acceptable level. Significant increases are necessary to restore profitability. With today's oil price level we are still at the bottom of the cycle."
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