Price Reports June 2019

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: June 2019
Standards Thermoplastics Engineering thermoplastics Polyurethane Feedstocks	Composites/GRP Standard Recyclate Engineering Recyclate

 

 

Standard Thermoplastics June 2019: Weaker rollover dominates polyolefins and PVC / Styrenics plummet / Clear reductions for PET / Demand remains very muted / Signs of feedstocks downtrending in July

PE: With only a few exceptions, a rollover dominated the picture for polyethylene in Western Europe in June. Reductions prevailed in segments with high imports. Although producers attempted to obtain margin gains, PE buyers were generally slow to place orders as they were expecting further reductions along the oil chain. The C2 reference for July fell significantly. Producers will endeavour to hang on to part of this reduction, although availability is returning to normal. On the demand side, further large purchases for stock are now unlikely because of the approaching holiday season.

 

PP: European PP producers were not always able to achieve a rollover in June, despite flat costs. Order activity slackened, as a reduction in upstream costs is expected in July. In the copolymer segment, many special offers were spotted. As the July propylene reference contract slid back by EUR 80/t, converters will be clamouring for rebates, while producers will try to pocket some of their price relief. In view of the long supply, converters are unlikely to buy any additional volumes. In supply agreements tied to the automotive industry, substantial reductions are expected.

 

PVC: Following the pattern for the ethylene reference, most contracts were settled at a rollover. Minor production problems in various corners of Europe were absorbed without any problems, especially since many customers were reluctant to make purchases in anticipation of falling prices, preferring instead to reduce their inventories. The European market has thus been uncoupled from the global increase in prices. All in all though, the price level here remains quite high. In July, producers will doubtless attempt to make good their margins once more, aiming not to pass on the full pro-rata cost reduction of EUR 37.50/t. However, their prospects of success are no greater than in previous months, particularly since the holiday season is beginning. Titanium dioxide producers will set out to gain clear increases for the third quarter. The price rise for the whitening agent ought to ensure that compound prices do not give way to the same extent as for suspension PVC. Plasticiser prices, by contrast, ought to undergo a further fall.

 

Styrenics: In June, styrenics prices in Western Europe followed the plummeting SM reference, which went down by EUR 143/t. For ABS, this effect was reinforced by decreasing composite costs (roughly EUR 100/t). Several producers at first tried to keep a part of the cost reductions. They only had limited success, however. For all styrenics, purchasers were quick to find other suppliers who offered them higher discounts in order to avoid an inventory build-up in the face of the weak demand. During the month, however, processors placed very few orders. First of all, this was caused by the general economic slowdown, secondly, by the holidays and long weekends and thirdly, by speculation about further price declines in July. Those who were betting on further discounts were probably right. PS and EPS prices are again likely to largely follow the SM reference, which has eroded by another EUR 48/t in July. ABS will also continue its downward trend, especially as butadiene has also become more affordable (down by EUR 50/t). Demand in July will probably benefit from the month’s high number of 23 working days. However, demand is likely to be dampened in many areas by the onset of the holiday season.

 

PET: Contrary to what had been hoped for, the first three weeks of June 2019 remained disappointingly cool and wet for the time of year. As a result, warehouses in the PET chain started to overflow at a large number of points. Processors were left sitting on some of their advance production and hence did not need to place any new orders. At the same time, increasing quantities of favourably priced imports from Asia flowed into the European market. Since the PX reference was settled at a considerably lower level at the end of May, European suppliers ultimately had to accept clear reductions in their PET prices too. European weather underwent an abrupt change in the last week of June, with high temperatures suddenly appearing over large parts of the continent. Warehouses started emptying out, and the season finally seems to be getting off to a start, but it is far from certain whether this summer weather is going to last. The PX reference for June gave way again, after spot prices had been pointing downward for a long time in June – which was also largely due to the weakness in PET. The direction in which notations are set to move thus remains relatively uncertain even though price pressure from other regions around the globe is continuing.

 

 

 

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 June 2019: Majority of prices on the decline / Weak automotive demand puts more pressure on notations / Downtrend likely to continue in July

The vast majority of engineering thermoplastics covered by this report tended downwards in June – in some cases quite considerably. In most cases, this was due to the weak demand from the automotive industry combined with a generally healthy supply situation. The three exceptions were again PA 6.6, where the price reduction was not quite so marked, POM and PBT, where the quarterly contracts were able to keep prices largely stable. Polycarbonate suffered the most, and last month's production cutbacks were further intensified. Producers were in some cases even selling off stocks at special offer prices.

 

Prices for the commodity-related materials also declined. ABS responded to the hefty fall in the styrene reference, while the unchanged cost of propylene was in most cases only just enough for a rollover with the PP compounds.

 

Automotive manufacturing continues to be the big worry. Most suppliers have already written 2019 off, and do not anticipate substantial improvement before 2020. The approaching holiday period with the expected extensive production stoppages in the auto industry will put additional pressure on demand. For this reason, a further downward tendency is to be expected, even with those prices that have remained reasonably stable until now. In some cases, growing imports will exert more price pressure, for example with PMMA. Only grades that are supported by other industries will be spared. With PA 6.6, the negotiations are taking place with no holds barred. The attitude of the converter community is “no price cuts, no more projects”.

 

 

 

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 June 2019: Producers drive TDI up despite slack demand / MDI firms noticeably / Ordering still quiet / Turnarounds approach

The unexpectedly steep price upswing for TDI that stunned buyers in June seemed to be the result of a concerted effort on the part of the three leading producers. Normal market developments would preclude such strong upward momentum, especially as toluene prices declined sharply.

 

Converters told PIE that their suppliers had announced hikes of up to EUR 200/t – which they, however, failed to achieve. Depending on the starting position, increases were mostly in a wide range of EUR 20-140/t. Supply remained sufficiently long and demand weak, despite converters’ less than overflowing inventories.

 

Despite the relatively slack demand and the more than adequate supply, producers could still make gains in July. In view of the long market and the progress made in June, whether there will still be scope for hikes is questionable.

 

In the MDI market segment, only a few buyers could achieve a rollover. Most faced increases, although they were not as steep as for TDI. Most players with whom PIE spoke this month still reported rather disappointing demand, but signs that the market may be livening up a little have been increasing. Converters' inventories nevertheless are full.

 

The outlook for the MDI market as a whole remains cloudy. Demand is not exactly buoyant, but the maintenance season has begun, so that the two influences may balance each other out. At the same time, pressure from low-priced Asian imports is increasing. Against this backdrop, prices could rise slightly, but a rollover is equally possible.

 

 

 

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 June 2019: Resins slip slightly / Demand below expectations / More pronounced downturn seen for July / Glass fibre with minimal movement

In Western Europe’s composites sector, demand clearly lagged expectations in June. The few deals with the automotive and utility vehicle sector were not enough to compensate for the altogether sluggish market. The only sliver of light was in the recreational vehicle segment. Resins prices initially were scarcely impacted by the plunge in the monthly styrene reference contract.

 

Most OEM suppliers have already written 2019 off and do not expect any noticeable improvement in demand before the end of 2020. The approaching summer holidays, with the usual plant shutdowns extended, will depress demand for resins and glass fibre further. This should accelerate the downward momentum for resins.

 

The key resin feedstock styrene lost further ground at the beginning of July, opening a path downward for the resins as well. The situation is similar for the stable to softer-tending starting materials phthalic anhydride and maleic anhydride. Taken together, the two factors could lead to a noticeable downward momentum in July. The recently firmed notations for titanium dioxide could lead to higher prices for gelcoats.

 

In the glass fibre market, standard chopped strand mats and some direct roving products saw slight price declines. This was likely due to the weak demand, as market factors afforded no plausible explanation.

 

 

 

 

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 June 2019: Prices largely unmodified despite increased purchasing costs / At most pro rata cost transfers / Significant discounts on rPET clear and rPET flakes clear

Against the previous month, most recyclate prices remained all but unmodified in June. Despite increased purchasing costs, the recyclers could increase their sales prices only slightly if at all, as there was plenty of material available – partly because of spot market offers.  By contrast, rPET clear and rPET flakes clear prices saw a marked slump. The suppliers finally had to acknowledge the months-long decline of virgin PET materials and decrease their prices because recyclate demand was cannibalised by inexpensive primary materials.  Further decreases are likely. The prices of the remaining recyclates are expected to remain stable in the weeks to come. This will not please the recyclers, who usually would, sooner or later, have to factor in the increased purchase costs to save their margins.

 

 

 

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 June 2019: Minor corrections with ABS and polycarbonate / Sluggish demand in automotive segment / Overall demand for regrind material nevertheless good / Price cuts likely with PA and PP compounds

June mostly saw only minor price corrections for recycled engineering thermoplastics in the European market, and the majority of types rolled over. Recyclate was, in fact, much in demand generally, especially in E&E applications. Automotive, which seemed to have recovered a little in the middle of the first half-year, is now again losing a considerable amount of its dynamism. That is also likely to have an effect on the recyclate material.

 

Recycled ABS has already fallen slightly as a result of the reductions in the cost of styrene and butadiene and the subsequent slide in the price of the primary material. This is likely to intensify in July.

 

With rPA, notations have for the time being remained stable. There are, however, signs of a certain unrest, emanating from the primary sector. There, the downward trend in the feedstock chain is now exerting considerable pressure. Only the quarterly contracts have kept prices stable until now. In the coming weeks, a downward tendency is expected with the primary material, both for polyamide 6 and PA 6.6. The recyclate products will follow suit.

 

The picture is similar with the recycled polypropylene compounds – producers of PP base polymers and compounds have so far been able to keep prices of the primary types stable, but the situation is delicate because of the slump in demand in the automotive industry. For this reason, recyclate prices have also remained unchanged. With falling feedstock prices there is also likely to be a correction in the primary sector, from which the recycled material will not be spared.

 

 

 

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!