RIL suspends operations at IPCL complex due to Global meltdown in petrochem product prices.

RIL suspends operations at 4 units in Vadodara facility

Global meltdown in petrochem product prices.
Pratim Ranjan Bose
Kolkata, Dec. 2 Reliance Industries has suspended operation of four units at the Vadodara petrochemicals facility (formerly IPCL complex) in Gujarat, according to sources.
Though Reliance official sources did not respond to queries in this regard, sources told Business Line that the Indian refining and petrochemicals major recently stopped operations of Acrylic fibre (24,000 tonne per annum), acrylo nitrile (43,000 tpa), PVC (55,000 tpa) and LAB (linear Alkyl benzene, 45,000 tpa) plants in the complex.
Industry sources indicated that the low demand position and the resulting inventory build up is forcing RIL to restrict production below capacity.
According to these sources, the decision to stop operations of four units was taken in the light of the global meltdown in petrochemical product prices.
According to industry sources, prices of petrochemical products came down approximately 60 per cent in the recent months.
The products witnessed biggest falls in prices include Polypropylene and PVC.
These sources also indicated that Reliance had either repeatedly reduced prices or offered price rebates during last one and a half months to keep pace with the global price movements.
However, this has hardly improved the demand scenario as petrochemicals product prices are yet to stabilise and consumers were deferring purchases in anticipation of further drop in prices.
The units currently operational at Vadodara are mono ethylene glycol (MEG)/ethylene oxide (20,000 tpa), polypropylene (1,10,000 tpa) and Low-density polyethylene (80,000 tpa).
Company’s shares closed at BSE on Tuesday at Rs 1,074.65 down 3.1 per cent from Monday’s close.
via: B.L