Budget FY2004 Worries User Industry
Reliance hikes products` prices, gets bullish
Reliance Industries has hiked polyester, polymer and fibre intermediates prices with effect from March 1, `03. The maximum hike was in the prices of polyester staple fibre and purified terepthalic acid. While PSF prices went up by 21.9 per cent to Rs 71 per kg, PTA prices rose by 24 per cent to Rs 46.5 per kg. This move comes even as the customs duty of Paraxelene (PX) one of RIL`s upstream products, has been cut by 5 per cent, and excise duty on partially-oriented yarn (POY) has gone down to 28.8 per cent, compared with Rs 71.16 last month. The company has also increased PSF prices to Rs 71, a rise of 18 per cent, compared with last month`s prices.
RIL seems to be very bullish on the demand of POY, which has prompted it to hike prices even as landed cost of POY has fallen to Rs 76 per kg from Rs 81 per kg. Industry analysts say that it could be a function of the hike in the feedstock prices for upstream petrochemical products. Indo Rama Synthesis, another major player in the man-made fibre market, has also increased the prices of its products. Indo Rama has increased POY prices to Rs 79 per kg compared with Rs 70 per kg last month. Meanwhile, the user industry seems to be worried about the post-budget price hike. The local market is facing sluggish demand for blended yarn and fabrics.
