Wednesday, 12 January 2022
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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.
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Standard thermoplastics December 2021: Majority of prices show little movement amid weak demand / Producers push to factor in energy and transport costs in January
PE: Prices in December rose slightly or remained stable, even though the C2 reference fell by EUR 10/t. With material availability tight, producers called for higher quotations, justifying this with the rise in energy costs. However, because demand from converters was very weak at the end of the year, producers were only able to obtain part – if at all – of their targeted hikes. In the case of LDPE and LLDPE injection moulding types and HDPE pipe grades, there was generally no movement at all, with prices sticking mostly at the previous month’s level. Demand ebbed noticeably because many converters wanted to have their stocks as low as possible at the end of the year, for balance sheet reasons. Consequently, they purchased no more than they absolutely needed. Apart from that, demand for several materials used in the building industry declined significantly, and suppliers to the automotive sector reduced their orders because of pessimistic industry forecasts. With EVA, the picture was completely different: the continuing supply bottlenecks drove prices further up. For months now, EVA has been jumping from one all-time high to the next. In fact, over the course of the year, the material increased in price by nearly 90%. Because there is at the moment absolutely no sign of availability improving, the high-price phase will presumably continue in the new year. Increases are also on the cards for the other materials, despite the rollover with C2. Producers of LDPE and LLDPE in particular will try to factor in the mounting energy costs, but because most HDPE suppliers have already gained some increases, the rises here are likely to be a little less.
PP: As propylene feedstock rolled over, notations for injection moulding grade PP and compounds remained stable in December 2021, despite producers’ attempts to tack on energy surcharges. Only film grades made any gains at all. This was because demand was not as weak as in the injection moulding and compound market segments, where OEM suppliers continued to order very little. In January, producers will make a new attempt to implement energy surcharges, despite the fresh rollover in the C3 notation. To strengthen their hand, they are thinking of introducing a separate energy index to use as a pricing instrument.
PVC: After the rising prices of the past 18 months, PVC base material took a break on the Western European market in December 2021. The high price level kept quotations in check after records had previously been broken in quick succession. The supply situation was also somewhat less tense at the end of the year, even if the overall picture was still one of restrictions. In the meantime, compound prices continued to soar, driven by the increased cost of titanium dioxide, flame retardants, stabilisers and other additives. PVC quotations are likely to trend upwards in January. PVC base material is similarly set to become more expensive, since producers wish to price in the increased cost of energy and logistics. The ongoing tight market situation will be to their advantage here.
Styrenics: The price changes in December 2021 were rather modest. PS and EPS suppliers were not always able to fully price in the styrene reference’s price increase of EUR 23/t, and a – sometimes weak – rollover prevailed for ABS. Supply was limited by various production problems, but met an equally weak demand. Many processors, in fact, did not buy more than necessary and also reduced their stocks with an eye on the year-end balance – especially as all styrenics had climbed to new record levels (EPS, ABS) or had at least returned to a very high price level (PS) in the previous month. According to PIE price ranges, polystyrene grades had increased in price by 40-45% over the course of the year, but currently, quotations are still more than EUR 300/t below the all-time highs reached in May 2021. For standard ABS, the increases added up to 50-55%, but for specialities and coloured grades, the premiums were somewhat lower because of the higher initial price level. EPS grades were 70-75% higher in December than a year earlier. Quotations are set to remain at a high level at the start of 2022, invariably pulled up along with the January increase for the styrene reference contract (up EUR 119/t).
PET: European PET markets were fairly quiet in December 2021. Supply remained fundamentally tight, but the situation was alleviated by a very low level of demand. For the few transactions that were carried out, hikes of between EUR 40/t and EUR 60/t still had to be paid. In most cases, these were amounts that the suppliers had not been able to recover in November. Despite the urgent cost situation, particularly as far as energy was concerned, producers were unable to push through any further increases. This was because anyone who was not absolutely forced to buy, held back. After a prolonged dry spell, sizeable imports from Asia have been announced for the first quarter of 2022. Additionally, the emerging fifth wave of Covid – the keyword being “Omicron” – and the lockdowns naturally depressed the mood. Last year thus ended in the same way as 2020, under the effects of the pandemic. There is also little to suggest any movement at the start of the new year. Lockdowns are set to have a mildew effect on the markets, with end-market demand maintaining an exceedingly low level. While production will remain highly subdued too, initial import volumes have been announced and have already been shipped for the second half of January. Further volumes will be following in February and March. In January, prices could remain stable, however, given that few transactions are 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 thermoplastics December 2021: Rollover for most types / Demand weak at end of year / With feedstock prices still rising, increases in January are virtually certain
The engineering thermoplastics covered by this report showed only a little change in December. The only exception was PBT, which saw a small rise. The quarterly contracts helped converters fend off attempts by producers to push through their targeted increases. The fact that the benzene contract for December rose only minimally also played a part. The glass fibre-reinforced materials also took a breather.
The short production month, extremely slow ordering by the automotive industry, plus the fact that many converters resorted to working from stock, kept overall demand very weak. The construction sector and E&E, on the other hand, saw indications of rising demand – also looking ahead to the new year.
January will see fresh attempts by producers to factor in the mounting costs for transport and energy. Also likely to play a major role will be the latest benzene contract, which has been fixed EUR 209/t higher, plus the bottlenecks with additives such as flame retardants and glass fibres, which will also see triple-digit increases. Some types, such as PBT and PMMA, are additionally suffering from bottlenecks in the feedstock chain. It is very probable that producers will be able to win the increases they are seeking, particularly as some of them are also dropping a broad hint of higher export volumes.
It does not look as if there will be any significant improvement in the availability of electronic chips for car manufacture before the middle of the year. Overall, the industry anticipates sales for the first half-year to be a third below those in 2019.
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 December 2021: Downward trend in TDI over / Tough MDI negotiations end in rollover / Slight inventory build-up possible in January / Cost of energy and transport not yet factored in everywhere
Except for TDI, which recorded a premium, there was a rollover of prices for the reported isocyanates and polyols. However, processors also had to fight “extremely hard” for the sideways movement in MDI polymer, as producers pushed for mark-ups due to increased costs for energy and logistics. In the case of TDI, the downward trend observed since the spring has apparently been halted by the latest increase.
With the end of the year approaching, orders from the construction sector also declined noticeably. Order activity for flexible foams for comfort and automotive applications remained low. Only the most necessary items were ordered, but demand could mostly still be described as normal for the time of year. However, there was a slight tendency to build up stocks because many processors fear maintenance shutdowns in spring.
In the case of TDI, the delicately developing upward trend could continue in January. Things are more robust for MDI: here, producers are already discussing additional triple-digit price increases with processors – without knowing the underlying benzene contract yet. At least partial enforcement should be reasonably certain because of the increased costs for logistics and energy.
As demand from the construction industry is expected to rise again due to the usual pre-production, market participants expect normal, possibly even good, order activity in January.
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 December 2021: Resins and glass fibre even higher / Fresh hikes expected in January / Securing supply the priority despite high price level
Although styrene gained only EUR 23/t in December, on top of earlier rises, this was enough to push medium reactive ortho resins higher, even during the year-end period, which is usually marked by weak demand. The upward momentum was felt particularly in supply agreements where prices were low.
January price negotiations will take place in an explosive atmosphere. Converters are expecting to be confronted with producers’ calls for surcharges to recoup their higher costs for shipping and energy, not to mention the recent EUR 119/t rise in the styrene contract.
One thing is certain: resin prices will keep pointing upward, even though demand at the moment is not uniformly robust. Towards the end of 2021, buyers were already scrambling to nail down supply, and this trend is likely to intensify in January. Prices are not the primary factor. The need to maintain sufficient production volume is front and centre.
At the end of 2021, all glass fibre products saw some upward momentum, especially at the lower end of the range. In the new year, fibre producers are seeking hikes of 10% or more, citing in particular higher costs for shipping and energy. Price increases for assembled roving and short glass fibres are likely to be even more substantial.
Whoever is in a position to build up inventory is doing so. Some buyers are even taking precautions now, ahead of an expected maintenance turnaround for a glass furnace in Slovakia that is scheduled to take place in the summer and could thin supply noticeably.
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 December 2021: Surcharges for rPET clear flakes and pure rLDPE film grades / Rollover predominates otherwise / Demand mostly at a decent level / Increased prices in the new year
Only in the case of clear rPET flakes and pure rLDPE film grades did manufacturers succeed in transferring the increased costs for energy and logistics to any significant extent. The suppliers also made minor adjustments to rPP prices, but for most materials, the rollover predominated; rPS even recorded a decline because of slack demand.
Despite the approaching end of the year, however, overall demand for recyclates was quite respectable, with the exception of rPP and rPS. In many cases, it was the low availability and high price level of virgin materials that guaranteed robust ordering activity on the part of processors. Positive stimuli also came from the sustainability efforts of brand suppliers.
The overall picture will not change much after the turn of the year – brisk demand meets less abundant supply. This provides the recyclers with ample reason to launch new attempts to price in the increased costs at the start of the year. Market players anticipate that they will probably have more success in January than in December.
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 December 2021: Diverging price trends at the end of the year / Shortage of base material keeps supply tight / Market players anticipate increases in January
The market for engineering recyclate in December was very mixed. With a particularly wide spread of price changes, prices for rABS and rPC trended downwards, although there were also very occasional increases, especially with rPC. Participants in PIE’s survey also reported a very large spread for rPA 6 and rPA 6.6, with both increases and decreases, so on average – depending on the type – December was characterised by stable or slightly falling prices. Only rPOM, which is experiencing an extreme shortage, saw marked price increases.
The tight availability of base material also limited recyclate output with all other materials – and thus naturally also affected the supply situation. The fact that recyclers’ calls for increases only seldom succeeded was due above all to the weak demand at the end of the year. This was because many converters were not buying any more material than they needed or were even reducing their stocks with an eye on the end-of-year balance sheet.
At the beginning of the new year, many of them will probably top up their stocks again. Should demand pick up again as a result, recycling companies will have an opportunity to factor in the increased costs for glass fibres, energy and logistics. Some players have already announced increases of up to EUR 100/t for various materials.
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!
