Price Reports May 2018

The following information is provided by Plastics Information Europe.  For more than 34 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: May 2018
Standards Thermoplastics Engineering thermoplastics Polyurethane Feedstocks	Composites/GRP Standard Recyclate Engineering Recyclate

 

 

 Standard Thermoplastics May 2018: PE, PP and PVC stuck with cost hikes / Declines with PS and EPS / PET preparing for steep rise / Costs shoot up significantly / Clear increases inevitable

PE: With the C2 reference price for May rising by EUR 20/t, European PE producers felt the time had come to restore margins. However, it became clear that the announced price hikes were too ambitious. The bank holidays in May gave buyers sufficient reason to hold back on purchasing. Overall, the PE market was weak, apart from the pipe sector. Prices for LDPE ended up slightly below the increase in the reference price, and only the pipe grades managed to match it. During the month, the term "production cutbacks" began making the rounds, partly initiated by maintenance work at feedstock plants. Prices in the oil and petrochemical chains also began rising, stimulating business in the second half of the month. The C2 reference for June has risen by EUR 63/t. This will be the lower yardstick for producers, because the decline in the high margins achieved back in spring 2015 has again taken prices close to the limits for European production. Because June is a full working month, demand should be livelier. Prices are expected to move up on a broad front and producers could well win increases above the reference rate.

PP: After the May C3 reference contract was fixed EUR 25/t higher, European PP producers wasted little time in sending out price increase announcements. With the many bank holidays in May, converters still had sufficient inventories and did not need to buy. Some increases did go through, but most landed far short of the monomer’s rise. For the indexed compounds, the C3 increase automatically triggered an upward adjustment. Here demand was noticeably firmer than for the commodities. The June C3 contact was fixed EUR 80/t higher, reflecting higher crude and naphtha prices. At minimum, PP producers will try to pass through the cost rise in full and add a margin component. As converters will have some catching up to do in June, demand should rise. For compounds, the indexed prices should rise in tandem, as usual.

PVC: With the market tending to oversupply, producers lost a slice of their margins in May. Rollovers predominated for base product and compounds, with pro-rata cost hikes of EUR 5/t reported. The upward momentum in plasticisers and titanium dioxide had slowed in the prior month and prices remain stable at a high level. Compounds and the pipe segment were particularly affected by the lull in demand due to the holidays. Sales volumes of E-PVC pastes remained robust, however, even in the previously weakening wallpaper segment. The massive EUR 63/t increase in the C2 reference contract went further than many had feared. Having had to accept margin cuts in May, producers will attempt to avoid this in June. They could then try and push through hikes in excess of EUR 30/t. With demand set to pick up further and maintenance work scheduled at a number of plants, this should curtail the oversupply. Negotiations could prove to be tough.

Styrenics: Further reductions were recorded here in May 2018. Polystyrene and EPS notations largely followed the decline of the styrene reference contract. Price reductions for ABS were smaller, as butadiene and ACN surcharges counterbalanced the downtrend. Holidays dampened demand. Additionally, many processors speculated on further price reductions in June at the start of the month, and only bought necessary volumes. In the second half of the month, these expectations failed in view of increasing SM spot prices. In the slipstream of the June SM reference contract (fixed at EUR 60/t higher), prices for styrenics will certainly also increase. ABS prices have additional upward potential because of the continuing uptrend of butadiene, which rose by EUR 140/t.

PET: The situation on the PET market became even more complicated in May 2018. The low influx of material from Asia, where prices exploded by 20% over just a few weeks, pushed spot prices up sharply in Europe too. This was accompanied during the month by reductions in European production due to the outage at the key PTA plants in Geel / Belgium. At the same time, the season got going on account of the good weather. Trading prices are now well above the contract prices – a phenomenon typical of tight market conditions, but one not seen with PET for a long time and currently causing concern. The long-term contracts of a number of big consumers scarcely increased, while the contracts for small to medium volumes were concluded at a higher level than for the month before. Since March, there have already been three-digit notations here. The signs for June are pointing to a storm. While the market is remaining tight, oil and petrochemical prices are rising. If the good weather continues and PTA supplies are not restored, PET prices could become unaffordable, since no real help is in sight from Asia. Three-digit increases across the entire market are not unlikely.

 

 

For more than 34 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 May 2018: Only minor price swings as spring settles in / Buyers' reticence limits price rises / Cost increases in oil sector will step up pressure in June

On the European engineering thermoplastics market, there were few significant price movements in the merry month of May. Nevertheless, even though none of the hefty surges of the previous months were seen, things were still bubbling under the surface, with PC, polyamides and POM moving more markedly than the other products. Despite that the situation remained generally calm, it seemed in most cases like a brief stop for a breather. The commodity-related ABS as a styrene derivative dipped slightly. Conversely, the PP compounds rose moderately.  Even though prices tended stable, the market situation in many areas is causing considerable concern. Delivery times remain long and supply is tending tight. Furthermore, the increase in the cost of oil in June is fuelling the rise in prices in the petrochemical segment, and in the aromatic sector. As a result, the pressure on the engineering thermoplastics will increase, and some products could well see some significant hikes soon. Looking at the market as a whole, prices are expected to rise. Styrene and propylene will also provide for increases for commodity-related ABS and PP

 

 

For more than 34 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 May 2018: Price relief for isocyanates / Demand weakens slightly / Polyols unchanged / MDI and TDI notations should soften

It was clear that after two years of rising, the price surge for isocyanates would peter out. However, no one dreamed that the notation would begin to plunge in May. Polymeric MDI prices for large and medium-sized accounts declined by around EUR 100/t on average, but in some cases by as much as EUR 150/t. Pure MDI was unable to buck the trend. In an uncertain market, TDI saw the first declines since 2016. Notations for polyols remained largely unchanged.

For the isocyanates, further downward momentum looks very likely in June, although it is unlikely to be as sharp in the recent past. The MDI feedstock toluene trended only slightly firmer in May, so that there is no impetus to rush out and buy. By contrast, the toluene contract was fixed much higher, so this should sharply brake any downward momentum.

 

 

For more than 34 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 April 2018: RResins still on a rollercoaster ride / SM reverses course after dip / Glass fibre products may gain some momentum in Q3

The downward trend for medium reactive ortho resins dug itself in in May. On average, the decline was EUR 40/t, for some products even more. The latest price movement for the styrene reference contract could put paid to any further downward movement, however. After a dip in the two preceding months, the contract notation was expected to stabilise. Instead, the higher crude oil price drove the monomer EUR 60/t higher. Against this backdrop, resins producers will do whatever they can to recoup at least part of the cost rise as demand improves.  In general, resins should at least see a rollover in June, but prices for small orders could rise again, following feedstock development. By the end of May, the many bank holidays had left their mark on demand, which receded somewhat.  Glass fibre prices with the exception of assembled roving remain unchanged. The latter saw some upward momentum, but any changes drove the PIE range only slightly higher. For many products, however, the trend – as far as it is visible – is towards incremental increases in the Q3 price rounds.

 

 

For more than 34 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 May 2018: Widespread price increases despite shortened production weeks / Export demand and high waste costs fuel upswing of film grades, rHDPE pipes and rPET / Further hikes likely in June

Shortened production weeks have muffled the generally good demand on the European recyclates market. Film grade inventories have been depleted for weeks and demand from Asia remains strong. In many cases, only the current production output is available. The markets for hollow body and bottle scrap have dried up, leading to cost increases for the rHDPE pipes and rPET segments. Additionally, there have been significant logistics problems, as many freight forwarders have taken advantage of holidays to extend their weekends.  For June, price increases are expected across the board. The longer production weeks, coupled with multiple seasonal upturns and rising costs, are likely to provoke demands for hikes in most market segments. Numerous PIE partners are also reporting increased demand from formerly less-known sectors – a consequence of growing public awareness and the anticipated regulation changes regarding the circular economy.

 

 

For more than 34 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 May 2018: All is still calm / rPC tends upwards / Demand reasonable despite many bank holidays

So far, May has passed by unnoticed for the majority of engineering recyclate products, and secondary ABS material actually fell slightly due to the drop in primary prices. In the case of PC, particularly low prices were frequently pulled back into line because the supply of base polymer is so tight.  The loss of production in the past few weeks due to the spate of bank holidays further extended delivery times. Order books continued to be well filled although there was a certain slow-down effect due to the stoppages. Capacity utilisation was quite good.  Should producers on the primary market manage to push through higher compound prices – which is probable with some types – an upturn in recyclate prices would also be on the cards. This applies in particular to the polyamides, but also to PC because of the shortage of base polymer. Overall, demand should remain good.

 

 

For more than 34 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!