Price Reports November 2021

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: November 2021
Standards Thermoplastics Engineering thermoplastics Polyurethane Feedstocks	Composites/GRP Standard Recyclate Engineering Recyclate

 

  Standard thermoplastics November 2021: Weak pre-Christmas demand puts prices under pressure / Producers and processors position themselves for 2022 negotiations / Omicron variant causes explosion on PET market

PE: For LDPE film, November began with announcements by producers of high, triple-digit price increases, although they did become less insistent during the course of the month. Small buyers had to fork out more, but large players who had succeeded in building up stocks in the previous months were able to negotiate from a position of strength. The Christmas month is unlikely to provide any gifts to converters in the form of price reductions. Unless one or the other producer decides to clear out stocks, the market is likely to witness another small price increase. The C4 films are also expected to become more expensive. This is also reflected in the tone between producers and converters, which is becoming increasingly bitter. Converters are complaining, for example, that producers are not lacking in “creative justifications” when they announce price increases. Overall, it has to be said that decisive negotiations are on the agenda in December for producers and pipe manufacturers. Both sides want to take up a positive position for the start of the new year and will certainly battle for every euro. Only for EVA is the situation to stay the same, with “Groundhog Day” coming round again: the alarm clock rings, prices rise by triple-digits, yet hardly any material arrives at the converters.

PP: The EUR 95/t rise in the cost of C3 pushed PP prices higher again. Producers also sought to add energy surcharges but were not successful due to already cautious demand and record price levels. For film grades, which have already set records, they were often unable to pass on the higher C3 cost in its entirety. Of course, this doesn’t mean that the hikes are off the table. In December, producers will try again to pass on their higher energy costs. Whether they succeed is another question. Converters ordering more to reach their annual bonus could give them a boost. The monomer price will provide no impetus for increases in December as propylene rolled over. This means that compounds indexed to C3 will see no change in the index. Conversely, for contracts indexed to standard PP, further hikes cannot be ruled out even though some compounds are already experiencing record highs.

PVC: With PVC prices climbing yet again in November – the 18th month in succession – it is not surprising to see more record levels. Nevertheless, having said that, prices advanced particularly heavily last month because producers of S-PVC base materials factored in higher energy and logistics costs. Converters had nothing up their sleeves to counter this in view of their high demand and the very tight supply situation. They still showed their frustrations during price talks, and the overall mood certainly worsened. In the case of compounds, prices were driven up by both the rise in the cost of S-PVC and the latest price hikes for additives. Market players are working under the assumption that PVC will remain at a high level in December. Although no particular impulse is to be expected from the ethylene side, producers will probably target further increases in order to kick off the new year with prices as high as possible.

Styrenics: The sharp rise in the styrene reference in November of EUR 232/t and increased energy and logistics costs, which some suppliers priced in, caused styrenics prices to spike. All grades recorded triple-digit gains, with EPS and ABS even reaching all-time highs. Even though some processors have curtailed orders to a minimum in view of the very high price level, demand for all grades remained quite brisk. However, there are now increasing signs of a slowdown, at least in German-speaking Europe. Demand is likely to weaken further in December, as many processors tend to reduce their inventories with a view to the year-end balance. Large jumps in prices are rather unlikely at the end of the year, especially as the recent increase in the styrene reference by EUR 23/t was quite moderate compared to the previous month. A pure cost transfer would result in slight premiums for polystyrene and EPS, while for ABS, it would lead to a rollover with the virtually unchanged component costs. However, the tight market situation for ABS could continue to fuel price increases and, as with other materials, it remains to be seen how individual suppliers will deal with the issue of energy and logistics costs.

PET: The plagued year – literally – was still far from over in November. In the first two thirds of the month, European PET buyers put up brave resistance and suppressed the growing panic that was developing due to the consistently deteriorating supply situation. They were also able to do this because demand from end-markets is experiencing an equally bad off-season low. But then the new Omicron coronavirus variant came along, and things became even worse. Especially in hygiene-related and medical segments, panic broke out and infected a large number of other areas. The already tense spot markets subsequently exploded, and any of the small to medium-sized contract buyers who delayed purchasing until late in the month then also had to swallow a surcharge of a few euros. Anyone who signed a contract early, on the other hand, was able to breathe a sigh of relief because early agreements were frequently booked in at a rollover. On the demand side, relatively little activity is normally to be expected in December, but in view of the barren supply situation, the status could well change this time. The first exploratory inquiries have apparently already been received with regard to the spring requirements. Nothing much is likely to change as regards the dramatic supply bottleneck – including the disastrous import situation. At the same time, the extremely large increases in the cost of logistics and energy have not yet been factored into the PET sector. It is to be feared that producers will exploit the situation in December to push through correspondingly large price hikes.

 

 

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 November 2021: Prices show little movement in November / Significant increases imminent for flame-retardant and reinforced materials / Production cutbacks with base polymers

With only few exceptions, there was very little movement with engineering thermoplastic prices on the European market. The main reason was that many compound quotations had already been fixed for the quarter. Producers are particularly concerned about the exploding energy and transport costs and are endeavouring to factor them into the product prices. So far, however, they have seldom succeeded. One large producer announced hikes in the high triple-digit range but had to quickly rescind them when converters categorically rejected the move.

The building industry continued to order at a solid rate, and the E&E sector was also operating at a reasonable level. Demand from car production was still very weak, which is why many base polymer plants are now operating at reduced capacity.

The situation is unlikely to change very much in December. Although some of the high price increases announced by the producers will go through, the majority of the rises will probably not be implemented until January, when the negotiations are held for the first quarter of the new year. Significant increases are likely with flame-retardant and reinforced materials, along with the PA 6.6 and PBT compounds that are plagued with feedstock problems.

 

 

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  November 2021: Hard-bargaining processors achieve rollovers and discounts / Weakening demand in all sectors / Higher cost of energy and logistics will factor into prices in January

Isocyanate and polyol producers were unable to push through their markups, which were primarily intended to cover the higher cost of energy and logistics. In some cases, there were tough discussions, especially in the case of polymeric MDI, but the processors were able to assert themselves and achieve at least a rollover, and in many cases even reductions. The weakening demand supported their position and, in the case of MDI, so did the benzene contract, which was fixed to a lower price point in September and October. In the case of MDI pure and TDI, the low order volumes from the automotive sector even led to a slight discount – despite higher toluene prices in the case of TDI.

The supply situation has stabilised further. Contract volumes have now mostly been delivered to a satisfactory extent. Only the MDI plant in Hungary, with about 10% of the total European capacity, was undergoing maintenance – but PIE received a force majeure notification for the BorsodChem plant shortly before the editorial deadline (see PIEWeb of 19.11.2021).

Orders from the construction industry were still quite healthy, but the first signs of a more cautious approach have already become visible as the year draws to a close. Orders from the comfort and automotive segments were weak, and the higher order volumes for consumer goods only had a slight stabilising effect.

It is unlikely that December will see price movements on a larger scale. The benzene contract, which is up by EUR 58/t, did not change this. Neither did the latest increase in toluene prices. Producers will only become active again once the new quarter starts in January, but then probably with more vehemence.

 

 

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 November 2021: Resin, glass fibre still soaring / Producers eye energy surcharges / Glass fibre prices seen higher in January

Higher production costs, especially for the principal feedstock styrene, drove prices for medium reactive ortho resins a further EUR 80/t to a new record. In particular, contracts sealed at lower prices were affected. Even large customers could not avoid paying more. In the meantime, even the thermosetting resins segment is beginning to experience calls for energy and transportation surcharges. Up to now, these were only aimed at the thermoplastics market.

Little change is expected in December. Resin producers facing higher costs will renew their calls for energy and transportation surcharges, and some will succeed in increasing prices. Most will take effect together with Q1 2022 contract negotiations.

Pressure on converters will gain further momentum when suppliers succeed in adding contract clauses calling for energy surcharges, and this looks likely to be soon. Hardly any buyers will be able to avoid paying if they don’t want to risk supply delays.

The same goes for buyers of glass fibre, who will see announcements of triple-digit hikes at the latest in the upcoming first quarter. That producers will be successful in passing these through is questionable, due to the soft demand. Assembled roving and short glass fibre, for which the supply side is seeking increases of up to EUR 300/t, will surely move upward, possibly already during December.

 

 

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 November 2021: Cost transfer succeeds across the board in November / High price level stifles demand in some areas / Agricultural sector could face a bottleneck in spring

In November 2021, European recyclers managed to pass on the increased costs of production scrap, energy and logistics to their customers, at least for most reported grades. Extreme hikes for primary products kept demand for recyclates high in many cases. Production scrap for producing LDPE film recyclates remained scarce due to strong exports.

Overall, demand is now dropping more sharply with only a few exceptions: only the construction sector and some PE bottle applications are still proving to be quite robust. Order activity from the agricultural sector, on the other hand, declined noticeably due to the high price level. The usual pre-production of agricultural films is frequently neglected. This means that there could well be shortages of agricultural film in the first quarter of 2022.

The trend of passing on higher costs for production scrap, energy and logistics is likely to continue in December. The first pronounced demands for increases were made for rHDPE grades, among others. However, the surcharges are unlikely to take effect until January, as the seasonally decreased demand in December will provide sufficient resistance.

The PET market continues to suffer from a lack of freely available volumes of secondary materials. One of the reasons for this is that large retail chains have been keeping more scrap material within their own companies for some time. Also, the high prices are apparently promoting the substitution with other polymers – a trend that could intensify.

 

 

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 November 2021: Converters force rollover for all types / Calm prices expected well into January / Vicious cycle of low processing rate and lack of base material

Cautious attempts by recyclers to hike prices were in most cases not accepted by converters, with most stubbornly resisting any such moves. Despite the cost increases on the recyclers’ side, general agreement was finally reached to go for a fairly stable rollover for all products. There were certainly also plenty of heated price discussions, especially with the glass fibre-reinforced and flame-retardant recyclate types.

Meanwhile, the situation with the base material is becoming tighter and tighter. The availability of production scrap from car manufacturing is deteriorating even further, and in some cases, the delivery times are as much as 14 weeks. 
The building sector seems to be divided into two halves: half the converters have already rung in the end of the season and cut back significantly on any buying activity. The same is true of the players in the automotive segment. The other half sees the declining demand as an opportunity to build up stocks despite the high price level.

For December, the majority of market players anticipate a further rollover for all the types covered in this report. At best, only small increases above the levels already reached are possible, but this will predominantly affect the reinforced materials. New customers, on the other hand, will have to pay much higher prices now, prices that will hit regular customers only gradually, and then not until the coming year.

 

 

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!