Price Reports February 2022

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 February 2022: Widespread rollovers for PE, PP / PET prices move higher around end of month / War in Ukraine rattles customers / Conflict undercuts orders for March

PE: The generally sluggish demand in February thwarted PE producers’ plans to hike their prices following the rise of EUR 67.50/t in ethylene reference. But that was not all: due to the particularly poor demand with LDPE, LLDPE and some HDPE types, they even had to grant price cuts. It should nevertheless be said at this point that, for some time now, prices have been at a very, very high level. The picture is now additionally being affected by the implications of the war in Ukraine. Many converters and their customers are experiencing great uncertainty and putting their foot on the brake when it comes to ordering. The still-high price structure and the probable continuation of the subdued ordering activity is likely to lead to a situation in March in which producers can only factor in part of the latest C2 cost increase of EUR 95/t – and, with HDPE blow moulding and blown film grades, may possibly not even succeed with that, in view of the surpluses. EVA remains entirely unaffected by developments with PE. In view of the massive shortage on the European market, the material continued to soar unchecked.

PP: Prices for most homopolymer grades covered in this report rolled over or were at least close to a rollover. Copolymer grades occasionally saw substantial rebates, while light coloured talc-filled compounds were pulled slightly higher. The automotive industry, which was the main driver of demand, was unable to work off the large order backlog. On the whole, demand was flatter than a pancake. Injection moulders only covered their immediate needs or grasped for special offers to fill inventories – not least in anticipation of an improving economy. In the last few days of February, the war in Ukraine created uncertainty. The performance of the consumer packaging sector was disappointing. Order volume fell much faster and more steeply than expected. Film manufacturers could also find ample spot material and didn’t need to call up contracted volumes. Supply of homopolymer from European sources was more than adequate, despite several plant outages. Imports from the US and South Korea were plentiful and could be had at competitive prices. Here, prices for small and medium-sized orders were often below the PIE range. The EUR 95/t rise in the March C3 contract will not have much of an effect. Converters’ order books are remarkably thin for this time of the year. One of the reasons is uncertainty over the war in Ukraine. This is especially worrying as large automotive OEMs, particularly in the utility vehicle segment, are exiting Russian joint ventures. European producers are being doubly hit. Cheap imports are robbing them of any chance to push through hikes.

PVC: Prices are spiralling again. Quotations for PVC compounds continued their upward trend in February 2022; the price of PVC base material was also poised to go up again, following a two-month breather. In the case of base material, the increase was driven primarily by the rise in price of C2 (up EUR 67.50/t). For compounds, however, it was the more expensive base material and price hikes for additives such as titanium dioxide, stabilisers, and flame retardants that had an impact. This situation is not set to end any time soon. The war in Ukraine has already triggered price increases for oil and energy, and March quotations for PVC and compounds are likely to be following suit.

Styrenics: In February 2022, prices for styrenics were still largely unaffected by the uncertainties arising from the war in Ukraine. Following the decline in the styrene reference (down EUR 51/t), prices for polystyrene and EPS also declined. In the case of polystyrene, some suppliers went beyond the SM cost reduction because they also took declining energy costs into account when setting prices. The reductions for EPS grey, however, were significantly smaller in view of the shortage of materials. Several suppliers also granted price reductions on ABS, even though composite costs barely changed – some players justified the reductions with lower energy costs, while others particularly brought previous peak prices back into the fold. Alas, the phase where prices eased somewhat after ABS and EPS had previously marked new all-time highs lasted only briefly. Russia’s invasion of Ukraine and the subsequent sanctions imposed by the West are unsettling the markets. This leads to increasing feedstock and energy prices. Styrene reference increased by EUR 93/t in March, and in the slipstream of this, PS and EPS will also become more expensive. Premiums are also foreseeable for ABS, especially since the costs for butadiene (up EUR 100/t) and ACN (up EUR 93.50/t) also went up in addition to styrene. Depending on the supplier, an energy component is also likely to be added. The bottom line is that new record prices for EPS and ABS are on the horizon. Additionally, logistics will be another source of grief for processors, as many truck drivers working across Europe come from Ukraine, and have returned to their homeland because of the war.

PET: European PET markets became increasingly nervous in February 2022. The start of the month saw the arrival of imports from the Far East as announced, so initial reports of a PTA shortage in Lithuania failed to make much of an impact. Towards the middle of the month, however, Asian FOB prices increased significantly, the production situation in Europe tightened, and oil and energy became more expensive. At the same time, pressure mounted on hesitant customers to make pre-season purchases, and warehouses were emptying. However, by then most purchases had already concluded with rollovers. Small volumes for ad-hoc consumption subsequently became more expensive, with prices going up by as much as EUR 50/t. The outlook for March is one of great uncertainty. The war in Ukraine is overshadowing the markets. Whether oil, gas, energy, or logistics, virtually everything is poised to become much more expensive. Further delivery delays are also possible in this situation. Upheavals in trade flows could dampen imports from Asia and make them generally more expensive, while any escalation of tensions in Central and Eastern Europe could impact the production situation in Lithuania. In short, little can be ruled out. At the same time, the spring season is getting off to a start, and with it comes demand for beverages, which continues unquenched even in times of crisis. All in all, significantly high price increases are doubtless on the agenda.

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 February 2022: With the exception of PC, most prices roll over / Supply and demand generally very weak / Minor price increases expected in March / Substantial price rise for glass fibres

Prices of PC compounds and blends rose in February, as did the PA 6 natural grades. All the other types remained at a rollover and, because of the generally weak to very weak demand, so did the glass-fibre reinforced grades. With the latter, however, further trouble is brewing in the coming weeks.

Ordering by the car manufacturing industry continues to be very slow, but the construction and E&E sectors managed to make up for some of the shortfall. Stocks were only being built up slowly, among other things because of converters’ current lack of liquidity. There were also occasional reports of converters shutting down plants.

Producers will make fresh efforts in March to factor in their increased costs for energy and logistics. Some converters will hardly be able to avoid submitting orders because of their very low stock levels, and they should be successful with nearly all types – even though the plant stoppages at VW and BMW will slow things down a little, presumably at least until mid-March. With some materials, feedstock bottlenecks are also causing problems. At least sheets and E&E remain at a solid level.

In the case of fibre-reinforced grades, the situation with short glass fibres is an additional problem. Looking ahead at Q2, there is talk of increases in the region of EUR 300-500/t.

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 February 2022: Stable prices with a slightly upward trend / Decent availability / Building up inventory in view of spring maintenance shutdowns

There hasn’t been a dramatic amount of change compared to the previous month for isocyanates and polyols, where the situation is still “dynamic”, as one processor noted. There are still enormous price differences on the market, although the trend – also because of the benzene price decline to EUR 984/t – is towards a rollover. Regional markets in Europe in particular are developing very differently. This makes many a processor despair.

There is also a sense of déja vu regarding the constant attempts on the part of producers to get in a price hike or two. The focus is still on increased energy costs – these, however, have begun to decrease in the meantime, which is also partly reflected in polymer prices. Nevertheless, quite a few processors are complaining about the “ominous oligopoly” of the “big five”.

The outlook for March: volumes remain available, but the first spring maintenance shutdowns are casting their shadow. Where possible, processors are starting to build up inventory – but with caution because, after all, prices remain high. The automotive industry is also expected to restart in the next few months and nobody wants to be caught with their trousers down.

This is driving prices up, although large jumps are not expected. It remains to be seen how the markets will develop when the construction sector starts to feel its full spring fever again and the automotive industry also awakens from many months of involuntary slumber.

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 February 2022: Ortho resins on the rise / Styrene to spur March hikes / Glass-fibre shortage cuts supply / Increase of EUR 300-500/t likely

Without any discussion, resin producers passed on higher costs for raw materials, transportation, and energy. February’s EUR 51/t decline in the styrene contract hardly impeded higher polymer prices as glycol costs held firm. At the most, small and medium-sized converters sometimes negotiated minor increases. In contrast, large accounts achieved a rollover or close to it.

In addition to the EUR 93/t March increase in the styrene contract, producers will try to pass on higher energy costs, in some cases using a separate formula. They are likely to succeed.

In March, demand for outdoor applications such as swimming pools normally picks up. Due to the currently unclear situation, that may not be the case this year. In any event, a limiting factor will be glass-fibre reinforcement.

In February, supply bottlenecks began limiting glass-fibre output. As some contracts were only partially filled, allocations occured, and refills were out of the question. Assembled rovings as a substitute for extremely undersupplied short glass fibres remained tight. Converters, producers, and distributors alike are forecasting price rises of EUR 300-500/t. If Russian gas should stop flowing, all Eastern European production volume will be unavailable, which is a catastrophic scenario for 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 the entire report, go to www.pieweb.com and sign up for a 48-hour free trial!

 Standard recyclate February 2022: Premiums on almost all grades / Strong increases for rPET clear / Only rHDPE pipe rolls over / Availability often improved / Demand picks up / Recyclers plan further increases

Demand grew, allowing recyclers in Europe to price in increased feedstock, energy, and transportation costs in February 2022. Only in the case of rHDPE pipe did they fail to do so as seasonal demand allowed for no more than a rollover. rPET clear and rPET clear flakes prices, by contrast, recorded particularly strong increases.

Next month, plastics recyclers will try again to price in their increased costs. They are likely to succeed in many cases, at least in part. Particularly in the case of rPP, however, competition from low-priced, off-spec virgin material could throw a spanner in the works of Western European recyclers.

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 February 2022: Rollovers predominate / Slight increase for black, GFR materials / Base material supply could worsen again

As far as engineering recyclate prices are concerned, a rollover dominated the scene in the first half of February, although not all types covered by this report came away completely unscathed. Because of the shortage of base material, many black grades saw significant increases, and prices of glass fibre-reinforced grades also occasionally rose.

Overall, however, the pressure on prices seems to have eased slightly, and the calls for high energy surcharges lately have not been as loud as they were a few weeks ago. Whether this issue has now been put to bed is, however, doubtful.

Polypropylene base material remained very short, especially the light-coloured variants. POM and polycarbonate, too, were virtually impossible to obtain.

From the end of February to mid-March, the supply situation is unlikely to improve, and it would probably be appropriate to talk of a generally “uneasy gut feeling”. Demand, for example, from fields such as E&E and household appliances will continue to pick up, and the market can probably be happy that automotive has not yet sprung back to life.

Nevertheless, some converters now anticipate a significant upturn for the automotive industry this year, a prediction that is backed by the latest forecasts of an approx. 7% increase in production. Looking ahead, they will therefore be keen to buy somewhat more material to enable them to meet the expected rise in demand.

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!