Price Reports October 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: October 2019
Standards Thermoplastics Engineering thermoplastics Polyurethane Feedstocks	Composites/GRP Standard Recyclate Engineering Recyclate

 

Standard Thermoplastics October 2019: The maximum remains the passing on of feedstock reference costs / Weaker market causes prices to often end up below / Feedstocks give way / Back to a downtrend in November

PE: With the ethylene reference for October going up slightly, most European polyethylene producers initially called for significantly higher price rises. However, these hopes were quickly dashed by the sluggish demand. Apart from that, buyers tended to hold back during the month because all the signs were pointing to cost reductions in November. At the end, producers were then able at most to pass on their extra costs, but in many cases did not even manage that. In some areas, the consequences of a fresh wave of imports from North America are being felt. The ethylene reference for November is EUR 30/t lower. Producers will find it very difficult not to pass on the reduction in full, and they will probably have to go a little further. It could be that the lower prices induce some buyers to purchase for stock, but the market generally has probably already run its course for the year.

PP: In October, European polypropylene producers did their best to hold margins at least stable. The palpably weak demand, however, sharply reduced volume sales. At the end of the month, the supply side had recouped only about half of its, albeit modest, cost rise. Notations for products that faced competition mostly saw a rollover. For buyers of PP compounds, the minimal cost increase did not have much of an impact anyway, as the automotive economy had already stalled. The propylene reference for November declined sharply. As demand is providing no noticeable impetus, producers will have no choice but to pass on their cost relief in the next round. Rebates for competitive standard thermoplastics could well be higher than the reference price decline would suggest.

PVC: Proportionately passing on costs remained the norm for the European PVC market in October 2019. Suppliers even had to grant slight concessions with rollovers in some areas. These slight margin losses are painful for producers primarily because the situation for their co-product caustic soda is anything but rosy. Looking at adjacent polymer segments, however, they are probably still among the luckier ones, because at least demand from the construction sector appears somewhat unaffected by the current economic downturn. As a result, a number of processors are planning normal, if not exuberant, purchases in November. Proportionately passing on the now even lower cost reference for ethylene will remain the benchmark. The prospects for December are the most likely cause of worry lines for producers.

Styrenics: After two months on the increase, styrenics prices in Western Europe trended down again in October. The SM reference contract declined by EUR 21/t and, once again, set the trend. Producers’ attempts to keep styrenics prices stable to recover their thinned-out margins were largely unsuccessful. They generally had to pass on the full cost reduction and in some cases, the reductions even exceeded it. In view of the economic slowdown, demand remained subdued – even for EPS insulating materials, where the volume calls were rather meagre for the supposed peak phase of the construction season. With ABS, oversupply pushed some suppliers to offer volumes at favourable prices under the condition that they would be delivered in the short term. However, many processors deferred volume calls because they were speculating on further price declines in November. The recent decline in the styrene reference has proved them right, because styrenics are likely to follow the SM decrease of EUR 65/t, especially as the prevailing oversupply rather strengthens the purchasers’ side in negotiations.

PET: In October 2019 too, European PET prices continued to drift downwards. While rollover announcements emerged in isolated cases, reductions were ultimately also achieved for small volumes. These were of roughly the same order of magnitude as the decline in costs in September. Large volumes and spot offers are now below EUR 900/t in most cases, pulled down by even cheaper import offers of Asian origin and the ongoing tendency towards oversupply, despite a number of European producers cutting back output. High-quality regrind, which has experienced declining prices for many months, is thus once again considerably more expensive than primary material. The cost base for November still remains unclear. But even if paraxylene remains stable or firms in October, this will scarcely lift the pressure on PET notations. The market situation is still trending highly liquid. Further price reductions can be expected in a bid to get business going at all.

 

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 October 2019: Prices start to dive / First part of quarterly reductions reflected in the monthly transactions / More decreases expected in November / Sales in crisis mode

In the first month of Q4, European suppliers of engineering thermoplastics were no longer able to hold on to the previous rollover line. Too many quarterly agreements had been reduced, which meant that the first decreases also had to be granted in the regular monthly transactions. Prices collapsed on a broad front. As regards the commodity-related materials, PP compounds rolled over, whereas the ABS materials fell back slightly.

 

The main reason for the falling prices was once again the subdued demand. The misery in the automotive segment has since turned into a crisis, which is increasingly also affecting industry in general as well as other sectors such as E&E. Demand for engineering plastics is declining in parallel with the economic mood.

 

For November, the prospects for producers are thus again not very good. Further instalments of the quarterly reductions will be due and customers will not hesitate to insist on them. In order to hold on to their business, producers will have no alternative but to bite the bullet. To make matters worse, the dam has now broken as far as the benzene reference price is concerned, having now undergone a triple-digit nosedive. This means that, even on the cost side, there is nothing left to provide stability. Anyone with prospects of doing good business this month can certainly afford a cold smile.

 

 

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 October 2019: Isocyanates and polyols deteriorate / Producers hold MDI hike plans / Demand stabilises in part but still weak

As demand continued soft, European notations for all polyurethane feedstocks deteriorated in October, some more sharply than others, with MDI the hardest hit. Although some market segments stabilised, on average prices gave way – by EUR 30/t. Rollovers were rare. As ordering in the UK, and to a minor extent in Belgium, was not exactly dynamic, producers shelved their planned hikes.

 

For November, a slight upward trend appears the most likely scenario. The lessening dynamic in some important European markets continues, however, and the monthly benzene contract came under pressure again.

 

TDI prices fluctuated between a rollover and a slight decline, but on the monthly average, declines outweighed gains. Over the course of November, notations should remain stable or give way minimally. Demand is still rather sketchy, and the aromatics value chain already began pointing downward in October.

 

In a few market segments, ordering seems to have caught up with supply, but order activity has weakened in the up to now rather robust construction sector.

 

 

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 October 2019: Little movement for ortho resins / Rebates certain in November / Glass fibre moving sideways

October was a quiet month for composites. Demand from most customers markets was below the seasonal average. Automotive could scarcely make any ground good, though the utility vehicle segment continued to order well.

 

With demand expected to remain soft and styrene pointing more sharply downward, resins prices will surely slip back in November, potentially by about half of the feedstock downswing – this especially as the slight decline in the October SM contract did not make much of an impact initially. Also worth noting is that phthalic anhydride just barely remained stable. The Q4 contract for maleic anhydride had not yet been fixed at press time.

 

Glass fibre products likewise showed little momentum last month and look likely to move sideways up to the end of 2019. The markets are well supplied, and demand from the automotive industry undoubtedly will not budge before the Christmas and New Year holidays.

 

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 October 2019: Prices still under pressure / Rollover only for rPP and rPS / Demand remains weak / Recyclers reduce output / Measures for more price stability in November

Standard recyclate prices in Western Europe declined in October 2019. They were under pressure from favourably priced virgin materials and weak demand. Only recycled polypropylene and recycled polystyrene were able to escape the general downward trend.

 

Considering the demand side, the much-expected post-holiday recovery failed to materialise, and there are no signs of improvement in the foreseeable future. In order to prevent a further build-up of inventories, several suppliers have reduced their output. This is expected to help in stabilising prices in November.

 

 

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 October 2019: Prices roll over / Demand very weak for the time of year / Many recyclate producers have their backs to the wall / Gap between primary and secondary PA is too small

Prices for European engineering thermoplastic recyclate remained unchanged in October. The main reason for this was the weak demand. Only the building industry purchased sufficient quantities of material, while all other sectors remained well below normal. Despite all attempts to avoid any further build-up of stocks, recyclers had to bite the bullet in the realisation that even further price reductions would not be able to significantly crank up demand.

 

The situation with the polyamides is precarious. With both recycled PA 6 and PA 6.6, the very low prices on the primary market were a big problem for regrind producers. Sales were correspondingly low because the majority of converters naturally opted for virgin material instead of recyclate with the price difference being so small. Pressure on the PA 6.6 primary compounds is therefore expected to bring about reductions in recyclate prices in November.

 

Polypropylene regrind material was also under heavy pressure from the primary sector, even though the effect has so far not yet made itself felt across the board.

 

Overall, early cutbacks in production are very probable this year, but prices may not necessarily fall. As early as mid-November, recycling companies could experience a reduction in business.

 

 

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!