Plastic jars set to become costlier
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20/06/2008
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Times Of India (New Delhi)
Nagpur: Rising petroleum prices are likely to make PET products costly. With crude on the boil, polymers the raw material for making plastic products have become dearer by over Rs 10,000 per tonne within a month. As a result there is a likelihood of plastic packaging material manufacturers passing on the cost hike to endusers. Cement and fertilizer industries are also among the major users of plastic bags. Sources in the market speak of shortage in supply of polymers since over a fortnight. Nagpur is one of the major centres for the plastic processing industry, with over 200 units in the city and around 450 in the region. Sources say there has been short supply from all the suppliers like Reliance Petroleum Limited (RPL), Gas Authority of India Limited (Gail), and Haldia Petrochemicals Limited. Polymers which are the raw material for making plastic goods are a by-product of petroleum. These include a range of polymers, such as poly propylene (PP), low and high density polyethylene as well as linear low density polyethylene. According to Dilip Gandhi, chairman of Vidarbha Plastic Manufacturers Association, poly propylene which was priced at Rs 84,400 a tonne as on June 1, got dearer to Rs 87,600 on June 5 and the current rates prevail at Rs 94,800 a tonne. When clubbed with taxes, the rate exceeds Rs 1,14000. PP is one of the commonly used polymers and is required in making food packaging as well as bulk packaging materials. It is also used widely in transparent garment packaging and consumer goods packaging. High density polyethylene was costing at Rs 83,610 a tonne on June 1, it rose to Rs 90,610 on June 12, which is the current rate. This polymer is mostly used in making carry bags, irrigation pipes and edible oil cans. The low density variety is presently costing around Rs 95,850 a tonne which is a hike of Rs 5,000 within a fortnight. This is used for making packages like milk pouches, lamination and so on. However, what is more alarming is the rising prices of PP, as its use is growing by 30% per annum, he said. Former secretary of Vidarbha Industries Association (VIA), Suresh Rathi says this has put the plastic processing industry in a tightspot and there is all likelihood of the effect being passed on to the consumers in the other sectors.