Price Reports April 2023

The following information is provided by Plastics Information Europe.  For more than 35 years, PIE has been an invaluable source of information for European plastics industry decision makers - a quick, yet in-depth look at the development of plastics markets and polymer prices. Available online 24/7 and as a printed newsletter twice a month. To read entire versions of the following reports, go to www.pieweb.com and sign up for a 48-hour free trial!

  Standard thermoplastics April 2023: Upward trend of previous months dissipating / Large-scale drop in quotations / Demand remains weak / No expectations of improvement in May

PE: The EUR 40/t fall in the C2 reference dictated the direction prices took in April, namely downwards over a broad range. Only a few speciality products, predominantly from the LLD and HD sector, were able to escape the fall. After a slight recovery in the previous month, demand also experienced another decline. Order call-offs were again down across all segments, with two sectors serving as exceptions: pharmaceutical and medical. The food and beverage industry at least reported only minor reductions. A look at converter capacity utilisation will, however, come as a shock: players in this segment reported almost unanimously that their production activity in April had declined further compared with the previous month, dropping an average of 10 percentage points. So, what is going to happen in May? Prices are likely to continue their descent: the C2 reference for the month fell once again, this time by EUR 10/t. But lower prices alone do not create demand. As long as the desire of consumers to spend remains low, there can be no chance of increasing call-offs. The problem is that converters continue to lack sufficient orders.

PP: The upward momentum in PP prices seen in February and March dissipated in April 2023, and the market turned around on the back of the EUR 40/t decline in the C3 reference contract. The size of the rebates offered initially reflected the fall in the monomer price. Then, in the last third of the month, soft demand led to further deterioration. Producers’ hopes that prices would recover after Easter were thus dashed. Apart from the many special offers for large accounts, toward month’s end many other buyers were able to profit from improved rebates. On the back of the price reductions for base polymer, the compounds also saw price relief. In May, market players can expect renewed pressure on PP prices as the C3 reference has fallen again, this time by EUR 15/t, and demand remains sluggish, due not solely to the many holidays and gap days. Compounds, too, are likely to witness additional small price reductions.

PVC: Once again, the decline in the C2 reference (EUR 40/t) defined the price direction even though many contracts were decoupled from it and ended up lower. Despite continuing plant cutbacks, the PVC market tended long, partially because a major French producer ended forces majeures at its plants, and imports were readily available. Demand meanwhile remained weak. To begin with, the Easter break provided for a subdued start to the production month. As it progressed, demand failed to rise a significant extent. Consequently, orders from the construction sector remained well below the usual level, and only the pharmaceutical packaging industry provided for reliable volume call-offs. In view of bank holidays and the still high level of inflation – which is proving to be a problem, especially for the construction sector – demand is not expected to improve in May. Besides, significant quantities of imports will arrive from Asia and the US. The long market is likely to continue putting prices under pressure irrespective of the development of the C2 contract.

Styrenics: Styrenics prices changed only minimally in April 2023. The stage for this was set by the slight increase in the styrene reference contract of EUR 19/t. Most producers initially tried to catch up on lost margins by raising prices a little more. However, restrained demand hampered their demands. Even attempts to at least price in the increase in the monomer cost were unsuccessful in many cases. Ultimately, EPS was dominated by rollovers, and polystyrene prices also remained unchanged or at best increased minimally. ABS, by contrast, mostly recorded slight declines, especially since composite costs also fell due to the EUR 20/t discounts for butadiene and the EUR 154.50/t decrease in ACN. Demand for styrenics remains consistently weak. EPS and polystyrene are suffering from the slump in the construction sector, and there are no positive stimuli from other industries. This is unlikely to change in any significant way in May, especially as the month is interspersed with several public holidays and long weekends, which reduce production volumes of processors. Despite this, prices for at least PS and EPS should increase somewhat after the styrene reference rose a further EUR 55/t in May. It remains to be seen whether this will be enough to give ABS prices some buoyancy. Not only are the other composite costs slowing down the material’s upward potential, with butadiene down EUR 10/t, and ACN off EUR 67.50/t, but so is the prevailing oversupply.

PET: European PET producers would have liked to raise their prices in April, but demand was once again weaker than previously expected. Only on the Iberian Peninsula was home to temperatures around 30°C, which naturally boosted demand for water and spurred the market for PET bottles. In many parts of Europe, however, the prevailing cool weather had a negative impact on seasonal hopes. Nevertheless, local producers were at least spared price cuts. At their peak, import prices matched the European level, which meant that there was no real pressure from that quarter. Market players therefore agreed peaceably on carrying over the prices from March. The optimism at the start of the season has again been postponed by a month. In May, however, things should at last pick up – at least that is the hope. Considering the relatively expensive imports, increases are to be expected. The end of production cutbacks at many European sites should, however, restrict this to a reasonable level.

For more than 35 years, PIE has been an invaluable source of information for European plastics industry decision makers - a quick, yet in-depth look at the development of plastics markets and polymer prices. Available online 24/7 and as a printed newsletter twice a month. To read the entire report, go to www.pieweb.com and sign up for a 48-hour free trial!

  Engineering thermoplastics April 2023: Falling prices dominate / Short month of May unlikely to bring much improvement / Converters already focusing their attention on Q3

The contract for the key feedstock benzene – which rolled over in April and rose EUR 89/t in May – did not turn out to be a factor in the price negotiations. The weak demand and influx of cheap imports put considerable pressure on the engineering material prices, which fell by an average of at least EUR 50/t.

In addition, there were some significant reductions in energy cost surcharges. This was felt above all with PA 6, where individual quarterly agreements were fixed several hundred euros lower in one go.

European production is still operating with reduced output. This was easily balanced out by the arrival of low-priced imports, which not only significantly improved supply, but also caused additional price pressure.

On the demand side, hardly any sectors are running anywhere near normal. Demand from the consumer goods industry has simply been too weak. Construction and automotive were also unable to report any trend turnaround. On the contrary, things have once again moved a considerable distance away from the normal level that recently seemed to be approaching. Converters again had to put up with many of their orders being postponed.

All PIE panellists seem to anticipate a dismal second quarter. Along with the constant influx of cheap imports, this is likely to result in prices crumbling further. Many converters are already pinning their hopes on Q3 in view of the present weak demand from application sectors.

For more than 35 years, PIE has been an invaluable source of information for European plastics industry decision makers - a quick, yet in-depth look at the development of plastics markets and polymer prices. Available online 24/7 and as a printed newsletter twice a month. To read the entire report, go to www.pieweb.com and sign up for a 48-hour free trial!

 Polyurethane feedstocks April 2023: Prices continue to fall amid weak demand / Triple-digit markdowns for TDI / Only soft polyols in rollover / Prices expected to bottom out soon, except for TDI

Prices for isocyanates continued to trend downwards after another tight rollover for benzene (down by just EUR 1/t). Despite production cutbacks by producers, supply exceeded the low demand from various purchasing sectors. TDI, in particular, suffered heavy markdowns, but this was also due to the still-high price level – before the April markdown, prices were only 3.3% below their all-time high of last November (and down by 6.1% afterwards).

Quotations for solid polyols also fell slightly, while prices for soft polyols remained mostly stable in monthly purchasing agreements. Market participants assume that price levels may now have bottomed out in view of production limitations. However, because demand is not expected to improve significantly, they expect prices to largely remain stable in the coming weeks.

This also applies to solid polyols and MDI. Here as well, market players expect prices to bottom out. Only TDI prices are likely to continue to decrease on a larger scale, as an end to the oversupply is not yet in sight.

For more than 35 years, PIE has been an invaluable source of information for European plastics industry decision makers - a quick, yet in-depth look at the development of plastics markets and polymer prices. Available online 24/7 and as a printed newsletter twice a month. To read the entire report, go to www.pieweb.com and sign up for a 48-hour free trial!

  Composites/GRP April 2023: Prices slide as energy surcharges fall away / Inflation reduces demand sharply / Big picture fuzzy / Little change likely in May

The styrene reference contract didn’t have much meaning for medium reactive ortho resin prices in April. While SM rose by a modest EUR 19/t, all other starting materials saw declines that were especially steep for the Q2 maleic acid anhydride contract, fixed EUR 200/t lower.

Against this backdrop, the inflation-related extremely weak demand and the gradual phase-out of energy surcharges were the most important factors influencing the market last month.

All in all, consumer demand was, and remains, exceptionally soft. Converters active in the thermoplastics sector saw many projects delayed. Only the medical device market seemed to be holding its own.

For May, the signals don’t all point to Go. Demand could pick up slightly – as visitors to the recent JEC Composites trade fair in Paris hoped – but on the whole, the overall situation for resin as well as glass fibre product is uneven and difficult to analyse.

The firming styrene monomer reference, which added EUR 55/t in May, could slow the downward trend but it may not be sufficient for the resin price slide to bottom out. Instead, the declining energy surcharges could add pressure.

With the exception of high end chopped strand mats, glass fibre products also cost less in April, thanks in part to the declining energy surcharges. These braked the expected upswing as Chinese demand began absorbing more of the material that otherwise might have been exported to Europe. It’s possible, then, that prices will balance out.

For more than 35 years, PIE has been an invaluable source of information for European plastics industry decision makers - a quick, yet in-depth look at the development of plastics markets and polymer prices. Available online 24/7 and as a printed newsletter twice a month. To read the entire report, go to www.pieweb.com and sign up for a 48-hour free trial!

 Standard recyclate April 2023: Demand remains weak for many grades / Off-spec virgin material increases competitive pressure / Weak outlook for May

Demand for many grades can be described as meagre at best in the standard recyclate segment as well. The reasons for this are more or less obvious: demand remains low because the main sales markets of construction, furniture and packaging continue to be weak. In addition, off-spec virgin material is cheaper than the corresponding recyclate for some grades.

This puts recyclers in a difficult situation. Here and there, the price level has already softened so much that further concessions would be uneconomic in view of, for example, the energy costs that have to be spent on washing plants.

The outlook for May remains dull. No significant upswing in incoming orders is to be expected.

For more than 35 years, PIE has been an invaluable source of information for European plastics industry decision makers - a quick, yet in-depth look at the development of plastics markets and polymer prices. Available online 24/7 and as a printed newsletter twice a month. To read the entire report, go to www.pieweb.com and sign up for a 48-hour free trial!

 Engineering recyclate April 2023: Prices continue to slide / Demand low, availability high / Subdued optimism for May

The price decline continued in April, due above all to the subdued demand during the Easter period and the slow growth in demand on the part of the converters. Worries about a recession are still putting a damper on consumer behaviour and are keeping ordering activity low.

Another factor, at least for some types, is the competition from cheap virgin material that is pushing its way onto the European market, often originating in the Far East. Nevertheless, recyclers benefitted from lower purchasing prices attributable to the general stabilisation and increase in production.

A market-wide revival in demand is unlikely to start in May. There are, however, occasional signs of optimism that a normal ordering level can be attained. In other sectors, there is still a significant lack of orders and purchasing power. The price movements are therefore likely to vary even more than earlier.

For more than 35 years, PIE has been an invaluable source of information for European plastics industry decision makers - a quick, yet in-depth look at the development of plastics markets and polymer prices. Available online 24/7 and as a printed newsletter twice a month. To read the entire report, go to www.pieweb.com and sign up for a 48-hour free trial!