Polymer prices rise across the board in Europe, with one exception

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Market expectations in Europe are for a significant reduction in PET prices this month, possibly in the of €40-50 per metric ton. Other commodity resins rose throughout the region.

Low density polyethylene and linear low density PE

In August, LLDPE and LDPE prices surprisingly increased by more than the €20 per tonne rise for the ethylene contract price. A combination of solid but unspectacular demand and tight supply has enabled producers to raise prices on average by €40-50 per tonne. Material availability tightened because of several planned and unplanned plant outages and fewer LLDPE imports.

LLDPE and LDPE producers are intent on improving profit margins this month and are insisting on raising prices, even though the C2 contract price fell by €25 per tonne. Producers initially sought price hikes of up to €50 per tonne but by mid-September, LDPE prices were up by €20 per tonne with LLDPE grades up slightly less. Material availability remains tight because of production cutbacks and plant turnarounds. Demand has largely failed to recover after the holidays with converters sitting on sufficient stocks. Packaging film demand has however improved.

High Density PE

HDPE producers pushed through price gains greater than the €20/ per tonne rise for the cost of ethylene in fairly thin August trading. HDPE film prices increased by €40 per tonne with blow molding and injection molding prices rising by €30 per tonne.

Supply tightness brought about by production cutbacks, planned and unplanned plant outages and fewer imports from North America. Demand remained very low across all key end use sectors at the start of the main summer holiday season.

HDPE producers have further improved margins this month despite the reduction of €25 per tonne for the ethylene contract price. Film grade prices were up by €20 per tonne in mid-September while blow molding and injection molding material prices were largely unchanged. Supply remains tight although imports from North America have picked up. Packaging film demand has improved considerably, but overall, demand remains quite weak.

Polypropylene

In August, PP producers called for price increases of €20-40 per tonne following a rise of €20 per tonne in propylene costs. By mid-month, PP prices had risen by €30 per tonne largely because of concern over reduced material availability. However, by the month’s end PP prices had risen by just €20 per tonne. There was ample supply to meet the low level of demand despite several force majeures being called and fewer imports. Demand was very low across all key end use sectors at the start of the main summer holiday season.

PP producers initially targeted price increases at the start of September although the C3 contract price had fallen by €30 per tonne. However, by mid-month PP prices were falling by around €10 per tonne. Demand remained very weak with converters holding ample stocks. Supply is tight although more imports from the Far East are arriving.

PVC

August began with PVC producers calling for a price rise of €40 per tonne despite only a proportionate increase of €10 per tonne to the PVC cost base resulting from the higher cost of ethylene. However, by mid-month, base PVC prices were rising by €10-20 per tonne. There was sufficient material to meet the very low demand despite production cutbacks and several force majeures. Rigid and flexible PVC compound prices were largely unchanged due to very low demand.

In September, PVC producers are insisting on higher prices to improve their underperforming profit margins even though the cost of ethylene is down by €25 per tonne. Although few large contracts had settled by mid-month, early deals indicated a small rise for base PVC prices. Supply remains tight due to cutbacks and plant outages. End user demand continues to be poor, particularly from the key building sector.

Polystyrene

In August, the styrene reference price surged by €78 per tonne as a result of an outage at Shell’s Moerdijk cracker in the Netherlands and rising spot prices. Polystyrene producers subsequently targeted triple-digit price increases at the beginning of the month. However, by end-month spot prices had eased back and demand was lower than expected, leading to PS contract prices rising close to the €78 per tonne SM cost settlement.

In September, PS producers initially called for small price increases to improve their margins even though the styrene monomer reference price settled down €8 per tonne. However, PS prices were largely unchanged with some minor concessions being granted to larger buyers. Demand has picked up after the holiday season across most end-use sectors, particularly food packaging. Despite this, many converters are limiting their purchases as price cuts are expected in October.

PET

PET prices were under pressure in August due to low demand, falling feedstock costs and competitively priced Asian imports. Consequently, PET prices fell by €20 per tonne. PET demand returned to its usual low season levels after the boost to sales from the major sporting events in Europe this summer. On the supply side, there was a force majeure announcement at a Spanish PET plant, but otherwise most plants operated at normal levels.

PET prices are falling further this month because of low demand and falling feedstock prices (August paraxylene reference price down €65 per tonne from July). Market expectations are for a significant reduction in PET prices this month, possibly in the of €40-50 per tonne range. PET demand is now entering the low season and the SUP directive mandating 25 percent recycled content in beverage bottles starting from January 2025 looms large.

* Source : https://www.plasticsnews.com/news/european-polymer-prices-rise-across-board-except-pet