Price Reports January 2020

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!

Articles: January 2020
Standards Thermoplastics Engineering thermoplastics Polyurethane Feedstocks	Composites/GRP Standard Recyclate Engineering Recyclate

 

 

 Standard Thermoplastics January 2020: Weak demand still dominates markets / Producers’ demands for the most part fizzle out with no effect / Impact of coronavirus outbreak could be seen in February

 

PE: In January, only very few of the PE grades covered by this report experienced any price change, and if they did, the change was small. The hikes of up to EUR 50/t that producers announced mostly went up in smoke, particularly as numerous production plants were operating at reduced output due to weak demand. There is a growing discrepancy between integrated producers and producers who have to buy in C2. With C2 rolling over, there were only occasional price increases for the more specified grades. The C2 reference contract was settled at a rollover at the start of February. Not only with the feedstock but also downstream there is a tendency towards a surplus now that Chinese industry is being slowed down by the coronavirus outbreak. For most PE materials, the price curve will likely point downwards. Many more higher-specified grades in the injection moulding, blow moulding and pipe segments could remain stable, however.

 

PP: The PP market saw little momentum at the start of 2020, despite a few producers’ attempts to push through increases. This was unusual as many converters replenished inventories despite having stocked up in December. In freely negotiated transactions, notations for compounds fell slightly, due to overcapacity in the market. Demand was strong for the most part. Due to pressure on selling prices, producers will try to pull notations up a notch in February, despite the stable monomer notation. Price pressure continued in January, which means that producers will attempt to achieve hikes in February. Although healthy order volume could lend some support, it seems rather unlikely that they will succeed. Where price levels are low, there is a chance of an upswing. Specified grades of PP copo could see relatively more price dynamic, as fewer alternatives are available. Converters are gearing up for seasonal demand. Order volume should be higher in February, though not exactly robust. The automotive market will prevent that.

 

PVC: Despite the C2 reference contract being settled with no change, European PVC market leader Inovyn confronted customers in January with demands to improve its margins – initially to no effect. Contrary to expectations, demand ran at a good level, with sales of window profiles faring well. With compounds, slight price reductions for titanium dioxide (PVC-U) and plasticisers (PVC) prompted a minimal downward movement. For February, there are price hike announcements. Producers want to put a stop to what they see as the continuing erosion of prices and margins. A close look at the facts, however, shows that this will not be feasible, or not in the initial weeks of February at least, especially since C2 has remained stable. The plan is most likely to prove successful for the PVC paste grades. With demand, February is set to be dominated by the build-up of stocks of finished goods.

 

Styrenics: In January, styrenics prices began to increase again, ending the downtrend of the previous three months. The new direction of the prices was largely provoked by the higher SM reference contract. After margins had eroded for several months, producers aimed to at least transfer the cost increase. For PS and ABS, this was largely successful. The hikes on EPS did not always reach the full amount of the SM cost increase. Demand was satisfying on a broad front. Inventory restocking after the turn of the year brought a boost. The EUR 50/t increase in the SM reference in February and resulting price hikes on styrenics could have a dampening effect, however. If processors were to speculate on declining SM prices in March, many of them would now not buy more PS, EPS and ABS than necessary – and spot prices are giving some first indications at a possible SM decline next month.

 

PET: In January, the bottoming out of Western European PET prices seen in December 2019 was confirmed. Prices remained at the levels attained or underwent marginal increases. Slight hikes resulted for smaller and specified volumes in the regular monthly transactions, generally as a consequence of the short-term oil price rises. The upward pressure eased in the second half of the month. The gap between the notations for the different trading models and primary goods and recyclate remained in place, as did the good market supply. Imports continued to displace European goods. However, the newly adjusted prices for 2020 mean that the offers are no longer as attractive as before. Little has changed regarding the oversupply, since demand is disappointing. The January costs for PX and MEG were not fixed at press time, but little momentum is expected. In the global petrochemical markets, prices remain under pressure. Demand should remain weak and supply abundant. Market players are hoping that March is the first month of spring.

 

 

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 January 2020: ABS firmer / PA 6.6, PMMA and PP compounds lower / PA 6 base polymers expected to push up compounds in the medium term / Demand slowly recovers

The engineering thermoplastics covered in this report presented a mixed picture in January. Whereas polyamide 6.6 grades, PMMA and, to a certain extent, polypropylene compounds trended down for various reasons, ABS materials (which have recently been updated for the PIE price reports) drifted upwards as usual on the wave of the latest styrene increase.

The small reduction with PA 6.6 is due to the recent improvement in the availability of feedstock, which is having a positive effect. Nevertheless, the price remains high. The cuts of up to EUR 300/t announced at the end of 2019 will presumably be factored in bit by bit until the end of the first quarter. PA 6 compounds, which have been stable of late, are likely to move upwards now that the base polymers have become more expensive.

 

The picture will probably be similar with PMMA. The maintenance turnarounds in the next few months at two German MMA plants in Worms and Wesseling will lead to a certain shortage of PMMA, which has recently been tending softer. A revival in demand expected in spring from outside the auto industry will therefore probably be utilised in the medium term by producers to push prices up.

 

 

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 January 2020: Isocyanates down another notch / Weak demand pressures producers' margins / Slack ordering melts MDI and TDI oversupply

 

After losing additional slight momentum over January so far, the downswing in polymeric MDI notations in Western Europe may be close to bottoming out. Some buyers at least expect this will be the case. As yet, the significant increase in the benzene contract price over the past two months has not played much of a role in view of the slack demand. Prices for pure MDI slipped back more sharply this month, most likely due to higher import volumes. For both MDI grades, only a few transactions were settled at a rollover.

 

With a market relatively well supplied despite the maintenance turnaround at BASF in Ludwigshafen, which has been ongoing since September, TDI prices gave way by around EUR 40/t on average. Similarly to MDI, the rise in imports also pressured prices. The trend to oversupply held up. As usual, polyols generally followed the lead of the isocyanates.

 

For all MDI grades, the well-supplied market in combination with the likelihood of benzene notations moving sideways in February should assure balance. A good guess is that price levels will remain unchanged.

 

In contrast, TDI prices look likely to soften, even if order activity picks up little by little. Producers’ margins will increasingly come under pressure, but there seems to be no antidote for this, despite the EUR 44/t rise in the January toluene contract.

 

 

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 January 2020: Ortho resins still pointing downward / Trend likely to turn around soon / Glass fibre oversupply pressures notations

The weak automotive economy continued to substantially depress demand, which at the beginning of the year pushed notations for ortho resins in Western Europe down farther than would have been be expected. The slight increase in the cost of starting material phthalic acid anhydride likely did not play a key role.

 

Demand was at the low end of the usual range, as many automotive OEM suppliers extended their plant holidays into late January. Ordering by other customer industries such as E&E and construction was not able to entirely compensate. Refilling was sluggish as the year began.

 

The substantial increase in the respective SM contracts for January and February appears to have nearly wiped out the declines seen in the fourth quarter of 2019. The knock-on effect for resins should start to become evident in early February. Sluggish refilling by converters should soften the price blow.

 

Substantially larger import volumes and sluggish demand pushed notations for glass fibre products more sharply downward than usually seen. Declines ranged up to EUR 150/t for standard chopped strand mats, which faced import competition. Other grades saw less pressure. As demand remains weak in North America as well, supply of most glass fibre products is long.

 

 

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 January 2020: Downtrend in prices continues / Only rPP and rPS remain stable / Pressure from virgin materials / Demand to pick up in February / Widely stabilising prices expected

Most recyclate prices in Western Europe continued to decline in January 2020. Only rPP and rPS were able to escape the general downward trend, with both having already lost ground in the previous month. Price pressure arose mostly because of oversupply and/or declining virgin material prices.

 

The market got back up to speed slowly after the Christmas holidays. Many recyclers and customers have only restarted production in the second week of January.

 

Processors are now starting to rebuild stocks of finished goods. The first positive seasonal stimuli can be seen from the construction and agricultural sectors. Demand for recyclates is thus picking up again. This has a supportive effect on the prices of all grades that are not in visible oversupply.

 

 

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 January 2020: Poor demand leads to rollovers everywhere / Prices may have bottomed out in many cases / PA 6.6 recyclate unlikely to escape reductions

All engineering recyclate prices in Western Europe were unchanged in January. Although regrinders’ compounding lines started up again fairly early in the year following the leap in business in December, a big hole in demand opened up at least in the first two weeks of January. Order activity slumped. In many cases it looks as if secondary materials have bottomed out after months of downward movement. Nevertheless, not much is likely to change in February as far as prices are concerned.

 

With rABS, for example, a great deal depends on the extent to which primary material producers can win a margin increase, after styrene was fixed a little firmer. With virgin material trending downwards for some time now, it is coming dangerously close to the price of the recycled product, which is why many converters are giving secondary material a wide berth, preferring to focus on the inexpensive virgin product.

 

The polyamides present a mixed picture. The price of benzene has returned to its normal level, and this is bringing about calm with PA 6 as regards the base polymer. Recyclers will certainly be happy if they can keep notations stable after the recent price battle in the primary sector. On the other hand, massive price cuts are imminent on the primary PA 6.6 market. Until now, rPA 6.6 has been relatively stable, but the latest developments on the virgin material market are bound to put recyclate suppliers under pressure, too. Depending on the price they paid for base material, regrinders will probably not be able to match the cuts in virgin prices.

 

 

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!