Gujarat accounts for nearly 15-20 per cent of all-India polymer processing
As polymer prices are on the rise, the downstream processing industry in Gujarat is mulling to raise prices of finished products. Besides, the processing industry has also responded by increasing purchases in expectation of future price rise.
"As crude prices are fluctuating in the international market, prices of polymer are likely to go up further in the coming months. So, people are trying to buy raw material at current prices in anticipation of future hikes.", said a plastic processor in the state who did not want to be identified. He added that demand from local processors has nearly doubled in the last few weeks.
Domestic polymer prices have risen thrice since January. Major producers including Reliance Industries, Gas Authority of India Ltd and Indian Oil Corporation have raised the prices of polypropylene by Rs 3 per kg and Rs 1.50 per kg for polyethylene this week. Currently prices of polypropylene are in the range of Rs 95.5 per kg, while HDPE (high density polyethylene) prices are around Rs 87.25 per kg, and linear low density polyethylene (LLDPE) prices are around Rs 83.75 per kg. Poly-vinyl-chloride (PVC) are up at Rs 67.25 per kg.
While HDPE is used to make bottles, chairs, mugs etc, polypropylene is used mainly in packaging, textiles, containers, high-tenacity bags to pack cement, fertilisers etc, laboratory equipment, automotive components among others.
A Gujarat based manufacturer of bottles, jerry cans, plastic containers said that there is hardly any other option but to raise prices of the products at least marginally. "Previously, we used imported polymer when the domestic prices went up, but now with the West Asian crisis prices of imported polymer is higher than domestic prices.", he informs. Prices of the finished products can go up in the range of 3-5 per cent, across categories.
Gujarat accounts for nearly 15-20 per cent of all-India polymer processing at around 90,000 to 100,000 tonnes per annum (tpa).
It, however, contributes to almost 50-60 per cent of the country's net production. The net investment in the plastics processing sector here is about Rs 70,000 crore, and annual business generated is Rs 150,000 crore.
