Price Reports August 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 August 2023: Producers continue to hope for higher prices despite ongoing weak demand / Polystyrene and PET set to increase / Actual revival of market situation not in sight

PE: Despite the rollover with the ethylene feedstock, initial offers in August from European producers were for increases around the EUR 100/t mark. Converters refused to go along with this. Later in the month, however, producers increasingly insisted on price hikes, even if it meant that they nipped a lot of the ordering in the bud. In Eastern Europe, prices fell – in some cases quite considerably. What is to be expected in September? Even after the summer holidays, demand in the European market is unlikely to return to normal. Converters consider an improvement to at most the pre-summer level to be more likely. After all, demand from the industrial and food packaging sectors is still well below expectations. Ordering activity could receive a further damper if producers attempt to raise their prices extensively. In any case, some converters have already topped up their stocks and have no need to place any orders. The pipe segment remains in critical condition: the C2 contract (up EUR 75/t) is likely to lead the way. Producers are likely to endeavour to factor in their extra costs in full, and the situation for some converters could become a threat to their existence. In the past few months, costs for the pipe grades have not dropped by as much as for other PE types. Heavy price increases in combination with a lack of orders is certainly a toxic combination.

PP: It looks as if the price upswing for polypropylene has bottomed out. With the C3 rollover, European prices for the polymer in August 2023 for the most part were flat at the July level. In the first part of the month, converters were able to parry producers’ attempts to raise prices and in view of the soft demand could even negotiate minor rebates. However, in the second half, as a turnaround seemed to be shaping up for September, quotations began to firm. And indeed, prices in Western Europe are likely to turn upwards with the meteorological start of autumn, driven by the September reference for C3 picking up by EUR 60/t. One producer already announced in August that it would raise its prices in the triple-digit range in September. The slight improvement in demand at the end of the holiday season should also have a supporting effect – even if demand is still miles away from normal levels.

PVC: Prices for PVC continued to fall in August, even if not as sharply as in the previous month. As expected, the holiday season had a dampening effect on orders, and hence demand – which was already at a low level – fell even further. Although output was still curtailed by production cutbacks and plant maintenance, contracts were fulfilled at all times. A turnaround appeared to come about in terms of imports and exports. Exports to Turkey increased while the inflow of material declined still further. Imported material became less attractive with rising price levels in the US and Asia. What will the autumn bring? As the holiday season draws to a close and more and more companies step up their operations again, orders can be expected to pick up slightly. Panel participants, however, stated that the pre-summer level of May or June could be achieved again, at best. Many players are ruling out a true revival of the market. On the contrary, the prospects remain gloomy and a number of companies have already given up on the 2023 financial year. Despite this, prices ought to rise again slightly in September in the slipstream of the C2 contract.

Styrenics: Styrenics prices in Europe turned upwards again in August 2023, putting an end to the downward trend of the past months. The price reversal was fuelled by increased styrene costs: the SM reference contract increased by EUR 108/t. Producers lacking backwards integration had to cope with even larger cost increases on the spot markets. In general, they in turn demanded higher premiums. Those premiums often did not reach the full extent of the SM cost increase. Especially for PS and ABS injection moulding grades, suppliers contented themselves with smaller price increases if that boosted the volumes sold. All in all, however, demand remained weak, especially as the peak of the holiday season put an additional damper on demand. Processors are hoping that demand in Europe will pick up somewhat as the holiday season comes to an end in September. Players who order have to expect higher prices, however. This is because the styrene reference trended even more sharply upwards in September (up EUR 170/t) than in August. Suppliers will try to pass on the new cost increase to their customers, which, considering the continued low demand, is again unlikely to succeed in full.

PET: In August 2023, the impression that the European PET market was bottoming out gained further credence. Demand still remained subdued for the traditional height of the season. At the same time, the import situation calmed down noticeably, with arbitrage evidently having lost much of its appeal. Against this backdrop, European suppliers increasingly managed to translate the recent moderate rise in PX costs into slight price increases over the course of the month – for small and medium volumes at least. Customers taking larger volumes, by contrast, generally benefited from a rollover. Hardly any momentum is evident in the market situation that would prompt decisive changes in September. Feedstock costs are trending upward, however, which could give rise to slight increases. A number of participants nonetheless see signs of a gentle revival for the fourth quarter.

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 August 2023: Prices still under pressure due to weak demand, cheap imports / Improved ordering from automotive to not change things significantly / Only PC likely to escape further price reductions in September

The August 2023 price trend in Europe with engineering thermoplastics was again very consistent – namely downwards. As in the previous months, prices came under pressure because of the weak demand and the influx of inexpensive imports from Asia. Although order call-offs from the automotive sector rose slightly, all the other customer segments presented an extremely poor picture. This was not only because of the general holiday season.

Even though the summer holidays are about to come to an end, the situation does not look very rosy. The much-hoped-for revival in demand is unlikely to happen. And because nothing is changing as far as the other parameters are concerned, prices will probably fall further in September – with the possible exception of polycarbonate, because with this material the rise in the benzene contract (up EUR 41/t) could consolidate prices to some extent.

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 August 2023: Demand remains weak with stable supply / Hopes rest on September – will next month bring the autumn upturn?

Low demand, only slightly reduced import volumes, and yet another lower fixed price contract (down 18 EUR/t to now 800 EUR/t) caused prices for MDI to fall further. The same was observed for TDI. Impulses from the client industries were consistently absent in the summer holiday month of August.

Supply proved robust despite production cutbacks and a force majeure, not least because imported goods flooded into the market and buoyed availability.

Hopes are resting on the month of September, when the downward spiral of prices is expected to slow down. In general, a cautious autumn revival is expected. It could also bring the first – smaller – stock replenishments. Of course, there is not yet much sign of all this in the order books. The comfort sector remains the main area of concern.

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 August 2023: Resin price decline may have bottomed out / No upswing in September expected despite firmer styrene / Glass fibre unchanged

The summer holidays dampened demand in the European composites market as well, whereby the automotive sector didn’t see quite the downturn that the construction industry did.

Converters fought for every crumb of the cake, but on the whole few transactions were agreed upon; most covered small volumes.

A modest upswing may be on the way but not before mid-month. The signals are not yet clear, and it could just as well go the other way. For both sides, agreeing on a supply contract is requiring more effort than usual, and pricing is playing a more important role.

The price of styrene, the principal feedstock for ortho resins, surged upward by EUR 170/t in August. Despite this, the soft demand may hold any attempted price hikes at bay in the coming weeks. A weak rollover could be the most likely scenario for September.

Except for standard chopped strand mats, prices for the glass fibre products covered in this report remained unchanged. The low-end mats again saw significant downward momentum, due to the presence of cheap imports and the small number of transactions.

The overall picture should remain unchanged in September. If anything, the soft demand for short glass fibre as a reinforcement for engineering compounds could open new prospects for assembled roving here and there.

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 August 2023: Prices drop across the board / Low demand provides little stimuli / Recyclers curtail production

In August, prices again knew only one direction: down. At least the discounts for several grades were no longer as high as in the previous month.

Overall, demand was very low due to the ongoing holiday season, but also because of consumer restraint. There was some pre-purchase activity, which revived ordering a little. Recyclers reacted to the weak demand by cutting back on production, but the market was still sufficiently supplied with material.

A similar picture can be drawn for rPET: contrary to the usual trend, order activity from the beverage industry this summer was less strong than usual. The high price level pushed many processors to primary materials or low-cost imports from Asia.

Outlook: it does seem that a bottom has been reached for recycled polyethylene. However, a real trend reversal is probably not to be expected in September. Thus, slight price increases seem possible at best. The other quotations for standard recyclates are likely to continue to decline, albeit not as strongly.

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 August 2023: Prices continue to fall / Cheap imports put rates under additional pressure / Unusually high demand in many segments

In view of cheap import alternatives for many types, converters called for further reductions. Recyclers often complied with this demand although not always in full. With the exception of PA 6.6 (substitution effect) the price cuts were nevertheless mostly in the lower double-digit range.

Demand for engineering recyclate remained surprisingly solid because major customer segments such as automotive stepped up their ordering activity. This induced many converters to do some forward purchasing in order to build up stocks for the production rally expected in late summer. Yet not all recyclers were able to benefit from this trend, because a number of converters closed down for the summer holidays and consequently had no demand. On top of this, there was tough competition from imported material, which made life difficult for some suppliers.

The outlook for September is mixed: The prices of some materials are still trending well above those of the import alternatives, so that European suppliers must adjust their rates downwards yet again. With some types, however, prices look to have bottomed out and the talks here are more likely to end up in a rollover.

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!