Price Reports July 2024

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 July 2024: Prices trend mix in summer month / Major European events disappoint hopes for better demand situation / Polyethylene, styrenics have shot at higher quotations in August

PE: After prices rose considerably in Q1 2024, all was relatively calm from April to June. During this period, converters suffered less from low plant utilisation but more from low selling prices. In July, the market developed in different ways despite the rollover of the ethylene feedstock. In many negotiations, the isolated movement for July saw the factoring in of the sideways movement of the C2 contract. At the same time, spot market prices climbed significantly. Although untypical for the summer, the market can be described as dynamic. The reason for this is the distortions in supply chains, as a result of which far fewer imports are arriving. The fact that many plants in Europe are still running with cutbacks in output is making the situation worse. The C2 contract has already gone up by EUR 20/t. All these factors combined indicate that prices could rise in August. The real absurdity of the situation becomes evident when taking a look at the ethylene reference. Over the past two years or so, the gap between contract and spot market prices has increased to a great extent – this phenomenon cannot be explained with normal macro-economic logic. It is striking that little mention is made of this enormous gap, either in the negotiations with market players or on the PIE price panel. Why everybody sees the white elephant in the room, but nobody wants to talk about it, is something PIE will discuss in a separate report fairly soon. 

PP: Many negotiations were already concluded early in the month. The guideline of the propylene contract – set at a rollover – was adopted. Contracts were fulfilled despite a number of plant outages. Due to the holidays, capacity utilisation was low for many processors. However, advance purchases of materials for the period after the summer holidays kept demand at a stable level. In August, plant outages and unusually low import volumes for the time of year are likely to lead to price premiums above the propylene contract (up by EUR 20/t). Due to the holiday period and the very low demand, it remains to be seen whether providers will be successful in this. Nevertheless, a fundamental change is not to be expected. The peak summer holiday season is setting in and bringing demand almost to a complete standstill. Meanwhile, compounders usually tried to pass along the rollover of the propylene contract. In some cases, however, suppliers did not shy away from small downward price adjustments in order to bring more volume onto the market. This trend is likely to intensify – compounders are expected to try and pass along the rising cost of propylene. This is likely to result in at least a slight price hike. 

PVC: Although the C2 contract for July was fixed at a rollover and demand remained subdued, PVC prices went up slightly in July. This was due to the anti-dumping duties on S-PVC imports from the US and Egypt coming into force. Producers exploited the fact that less low-priced imported material was on offer. Price hikes of up to EUR 50/t were demanded at the peak but the actual rise at the end of the month was significantly lower. Clear differences were seen between standard materials and specialities, with the hikes for “exotic” materials not crumbling quite as much. Despite one plant being closed for maintenance and production running at reduced capacity at numerous European facilities, supply was satisfactory. A brief plant outage had no impact on this – especially since it was rectified by the end of the first third of the month. While a certain number of tonnes made their way to India – which offered an attractive market for boosting sales – sufficient material was left for contracts in Europe. It was thus possible for demand, which remained largely stable, to be fully met. For August, the fact that the ethylene contract has been fixed with an increase of EUR 20/t is expected to prompt discussions. Suppliers will be tempted to pass on at least the increase in costs and may set about trying to improve their margins again. Buyers, by contrast, are likely to push for a rollover, since the effects of the holiday season will no doubt make themselves felt, with demand reaching a very low point. It is thus clear that no major price movements can be expected. 

Styrenics: Triggered by the significant reduction in the styrene reference (down EUR 138/t), styrenics prices also declined across the board in July. Polystyrene even fell for the third month in a row. In a number of negotiations, the level of discounts reached the full transfer of the monomer decrease after the first third of the month. Additional adjustments were made in some cases, so that the average discount sometimes exceeded the monomer reduction. Supply was generally good despite weak to very weak demand. Although European producers are still keeping their production throttled, imports have actually increased supply. The recent outages at Moerdijk impacted the development of the August styrene contract, which was fixed EUR 78/t higher. On 26 July, Shell reported problems with its cracker at the site in question, though it had initially only expected overall minor effects. Shell and its Ellba JV with BASF operate styrene plants at the site, which are also likely to be affected. Both lines together have a production capacity of around 1 mn t/y. Since the news got out, spot prices for the feedstock shot up several hundred euros within three days. Producers are expected to do everything they can to pass on at least a large part of these cost increases. In the weeks to come, the already-low demand is expected to be further dampened by the peak holiday season in Europe; company-wide holidays and maintenance are very common.

PET: The optimistic hopes of numerous participants in the European PET market failed to materialise in July 2024. The end markets showed much greater restraint than expected. The major events for the industry have come to an end and demand has fallen back in line with the reality of an ongoing hesitant consumer mood. Bottlers called off less than they had ordered at times, which meant that converters’ semi-finished-product warehouses remained well stocked. As a result, there was little reason to buy more material. Imports remained rather unattractive as in the past and European production was more than sufficient to meet demand. With PX costs more or less stagnating, moderate increases resulted in the price of PET, which were way below what had been feared. At the moment, the situation does not look set to change much during the summer holiday month of August. Converters have sufficient stocks to meet the rather low level of demand on the end markets. Little movement seems likely on the feedstock side. Significant impetus for price changes is thus lacking – apart from the decrease for the PX contract in July.

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 July 2024: Weak demand and significant drop in feedstock costs put pressure on prices / One exception: PMMA sees triple-digit rise

The market remained fairly well stocked with material, while demand continued poor. Apart from that, feedstock costs fell considerably – with one exception, namely MMA. The benzene reference price for July slumped EUR 162/t. Virtually nothing has changed as regards the production cutbacks. Producers’ stocks were further reduced and contracts were fulfilled at all times. The almost inevitable result was a further slide in quotations. 

The price cuts were, however, mostly in the range of less than 1%. One exception here were automotive PA grades, where the reductions were far more drastic because of the serious slump in the sector in question. Another exception from the general trend was PMMA, which rose EUR 160/t. The reason for this massive increase was the global shortage of the feedstock. MMA was, is, and will in all likelihood continue to be a rare material. On the spot market, PMMA prices have already been rising for some time, and the increases have now reached the contract market. An end to the upswing is not yet in sight. 

Apart from that, the pressure on the prices of the other engineering materials is likely to remain in August. The reductions of the quarterly contracts in line with the monthly contracts have not yet been carried out, and a positive trend turnaround in demand is certainly not to be expected during the summer holidays. The automotive sector remains weak. Where then is any impetus supposed to come from?

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 July 2024: Significant price reductions dominate landscape / Processors put more emphasis on monthly contracts / Demand in holiday mode

All prices for polyurethane precursors fell significantly in July. In the case of isocyanates, a single large producer caused a downward trend by advertising favourable offers. This further intensified the impact of the EUR 162/t drop in the benzene contract. The pressure was also a little higher for MDI than for TDI.

Although key end markets such as automotive and furniture were already in summer holiday mode, some processors ensured more movement on the market through strategic purchasing decisions and restocking. Something that was particularly striking this month: in the PIE panel discussions, many processors reported a switch from quarterly contracts to monthly contracts.

Prices are likely to remain under pressure in August. Although prices are unlikely to slide as much as they have recently, there are stragglers who finally want to participate. In addition to this, demand is at rock bottom for the majority of processors. They are concerned about availability and prices in September, when larger order volumes are expected again. It is unclear what impact the contract changes will have.

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 July 2024: Last reductions before summer break / Styrene increase not set to have any immediate impact / Glass fibre producers able to push through slight rises

The reductions for the medium-reactive ortho resins reported on continued in July 2024, with the main feedstock of styrene now having fallen by almost EUR 280/t since May. Continued weak demand and good availability further fuelled this trend. 

The downturn in the styrene contract to date has been priced in, which means that there should be no further notable reductions. Signs of a bottoming out were evident at the end of July already. Meanwhile, it is questionable whether the upward trend for styrene (up EUR 78/t) will be reflected in resin prices for August already, given the weak order situation.

Virtually no momentum is expected to emerge from the application markets in August. Instead, converters are talking about prolonged plant holidays or maintenance closures. They are taking their time in implementing these announcements, however.

Fibre glass producers have now been able to push through part of the price increases they have been repeatedly asking for. Given that it is the holiday season with an even weaker level of demand, they will find it difficult to achieve anything more. Despite this, scarcely any batches at special conditions have appeared on the market so far. Both sides seem prepared to largely sit out the summer.

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 July 2024: Summer, summer, summer – high stock levels and next to no demand / Everyone on the lookout for sales / Hopes pinned on September

Summertime is as slack as always. Almost the entire recyclate market is suffering from low demand. After virgin material prices remained stable, single-variety grades rolled over. The downward pressure only eased for washed grades, where prices stabilised despite a slight increase in input costs. Those who can deliver above-average-quality grades are doing well. All others are under significant price pressure.

The availability of base material declined a little. Several recyclers managed to tightly align recyclate production to demand. This means that plants continue to run at a reduced rate, but all contracts could still be fulfilled across the board.

As for further price developments, weak demand and the August holidays are expected to lead to minor changes at best. The market appears to be just too balanced. The Europe-wide holiday season continues to keep demand low. Some processors are reporting plant holidays. However, the majority are keeping up operations with only short maintenance interruptions – because they are hoping for an increase in demand in September and want to be prepared for it by building stocks.

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 July 2024: Sales of all types at rock bottom / For most recyclers, price stability remains main issue

The holiday period has started to hit almost all products, with far less being purchased of all the types covered by this report. For most recyclers, price stability is the main issue – and the main objective – and they are doing everything they can to achieve it. 

With converters, there is a distinct polarisation in order books – either they are full to the brim or there is such a yawning emptiness that one or two converters may have a genuine fear of survival. Why some of them are booming and some are at rock bottom is also a mystery for market insiders. 

A few converters already have sufficient orders for August. The majority, however, could do with far more and intend only to buy material once the orders have been received. One striking point is that some contract prices for August were already fixed in advance in July. This leads to the supposition that both sides are proceeding on the assumption that the markets will hardly move.

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!