KAP’s plastics manufacturing unit, Safripol, has secured a ruling in its favour in a dispute with Sasol over ethylene pricing, a matter first publicly disclosed in KAP’s 2024 financial statements and Sens announcements.
The industrial group on Monday said an independent arbitrator, appointed to interpret the supply agreement, ruled in Safripol’s favour, including the recovery of legal costs. The decision resolves the price issue, though Sasol could still request a high court review.
Sasol, South Africa’s main producer of ethylene and propylene, supplies these chemicals under long-term contracts. Ethylene is a raw material for Safripol, which produces polypropylene and high-density polyethylene used in food and beverage packaging such as bottles and containers, industrial products such as piping and crates, and consumer goods, including household storage items and plastic furniture.
Sasol has responded that the arbitration award did not address the pricing principles in the contract and that it is reviewing the decision and considering its options. The company also confirmed that the Competition Tribunal’s ruling on Safripol’s interim relief application has not yet been received and that multiple disputes remain ongoing between the parties concerning ethylene supply arrangements.
Other outstanding issues include a volume dispute between Safripol and Sasol. KAP said both parties are following the dispute resolution process provided for in the ethylene supply agreement.
“The status quo on volumes supplied remains while the dispute is being resolved,” the company said, adding that it is currently obtaining the contractual quantities of ethylene. The Competition Commission is also investigating whether Sasol’s market position breaches the Competition Act.
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