Price Reports October 2022

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 October 2022: Demand for some grades is so low that it is difficult to call it a market / Resin producers seek salvation in production cutbacks / November threatens to remain dreary

PE: With most types, price increases optimistically announced by producers at the beginning of the month had turned in the opposite direction by the end of the month. This was due not least to a EUR 45/t drop in the October C2 contract . As a result, producers often had to accept minor price reductions as imports exerted heavy pressure on the prices. Production cutbacks in Europe were increasingly reflected by the poor supply situation. Cheap imports from Asia, the US, and the Middle East were unable to compensate for reductions. The situation was made worse by weakening demand in all sectors. Virtually none of the customer markets are ordering like they did before; with EVA, demand from the beverage industry is particularly weak. There are tendencies in this industry to substitute expensive material with cheaper grades. Looking ahead, market players are waiting for fixing of the November C2 contract, as it will point the way for the polymer price.

PP: In September, the market for propylene was still a tough battleground, and this led to producers slamming the brakes in October, with production cuts across the board. These, however, were not sufficient to stabilise prices noticeably. On the contrary, the market saw rebates, in some cases in line with the C3 contract price. On the whole, production cuts and maintenance turnarounds reduced European trading volumes noticeably in October, though cheap imports were able to fill the gap for the most part. The continued sluggish demand did its part, too. As all end-consumer markets were plagued by fears of recession, converters ordered cautiously. In November, energy surcharges should finally be off the table during price negotiations. It is too early to know whether the output cuts will lead to a shortage of material.

PVC: Even though PVC quotations fell again in October, prices are still high. Weak demand and competition from low-priced imports, especially from Asia, exerted renewed pressure on prices, which had reached an all-time peak in April after remaining at high levels for the past two years. The falling cost of base material also had an impact on the price of blends and pastes – even if to a varying extent. On the demand side, the only ray of hope to emerge was the increase in volume call-offs from the pharmaceutical industry. All the other customer sectors were suffering the effects of the economic slowdown. The automotive and construction industries were particularly weak. Converters are shutting down an increasing number of production lines in response to the market situation.

Styrenics: Styrenics prices dropped again in October, disregarding the slight increase in the styrene reference (up EUR 9/t). This is because producers took the recent decline in energy costs into account in their sales prices, and weak demand combined with abundant supply created additional downward pressure. Thus, while some producers tried to limit the price erosion, other suppliers conceded ever higher discounts, which in some cases reached triple digits over the course of October. For all materials, producers have cut production, but with different results. In the case of polystyrene, a reasonably balanced market situation developed – not least due to additional, unplanned production stoppages. EPS, on the other hand, is trending long. The same was true of the ABS market. This mix is unlikely to change much in November, especially as demand for PS, EPS and ABS remains weak amid recession and inflation concerns in all end markets. What’s more, lower spot prices point to a decline in the styrene reference in November (the SM contract was not yet available by press time), further discounts are thus to be expected for styrenics in the current month.

PET: In October 2022, it was no longer enough to describe the uncertainty prevailing on the European PET market as “almost physically palpable” – demand had fallen to such an extent that it made the term “market” sound almost like a euphemism. Despite the extensive curtailment measures put in place by European producers, coupled with maintenance outages and forces majeures, they still find themselves left with considerable volumes they are unable to sell. The imports on offer were at prices way below the local quotations yet were also hardly taken up. And the fact that no PX reference had been found by the end of the month didn’t help either. No end to this misery is in sight for November. There is nothing to suggest that demand is set to increase. Reports of increasing PX prices are being received from Asia, which will doubtless make it considerably more difficult to find a reference in Europe due to weak demand pulling in the opposite direction.

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 2022: Prices trend further down / Weak demand and increasing pressure from Asian imports / Greater price stability likely in November due to production cutbacks

Prices of nearly all engineering thermoplastics continued to fall in October. Weak demand, declining energy costs and competition from cheap Asian imports prevented producers from implementing the price rises they had intended to impose in October as a consequence of their production cutbacks. Only with PMMA and the glass fibre-reinforced PA 6.6 and POM types did the prices tend at least sideways.

With PMMA and POM GF, converters will nevertheless probably push for price cuts in November. On the other hand, prices for most other engineering thermoplastics are likely to remain more or less stable, because producers have, through their reduced output, created a largely balanced supply situation. Any gaps are being filled at present by imported Asian material.

With PMMA, there is a recognisable trend at present for converters to distance themselves from contracts with the producers and to opt increasingly for spot purchases from Asia. It is being feared that this practice will be extended in the coming year to other materials. This would certainly not contribute in any way to the reliability of supply – on the contrary, it would further increase the dependence on the supply of goods from Asia.

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 2022: TDI soars to astronomical heights / Improvement in demand stabilises / Production cutbacks in intermediate products with barely any consequences so far / Additional price hikes

Flexible foams are hopping. TDI producers seized the opportunity in October and pushed through considerable surcharges of up to EUR 900/t in some cases in view of weak availability – and the next round of price negotiations has already begun. In order to cover their needs, if only to a certain extent, processors will have to put up with a lot in the coming weeks. While quotations for other intermediate products also saw increases, they were nowhere near the same level.

Talks with PIE panel participants indicated slight production cuts by producers. So far, however, these have had very little impact on the fulfilment of contracts.

Demand has not yet returned to normal levels, but orders from the automotive and especially the premium comfort sector picked up. Slightly higher quantities were ordered for spring pre-production in the garden and leisure sector. As a result, processors continue to fight for every available tonne of material.

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 2022: Significant rebates for resins / Soft demand drives downtrend / Most GF types roll over

With upstream costs stable to soft – except for the slight firming of styrene (see PIEWeb of 03.11.2022) – resins prices fell sharply, averaging a drop of EUR 90/t. The spread was relatively wide, ranging from small rebates of EUR 40/t to more pronounced declines of EUR 200/t.

Hikes in the form of the controversial energy surcharges vehemently pursued by producers in the recent past no longer played much of a role. The latest price softening was due in the main to the steep dive in the monomer a month earlier.

Demand remained clearly below average, even if it did pick up noticeably here and there. In very rare cases, buyers ordered additional material in the assumption that prices could firm again in the coming weeks.

Some members of the PIE price-monitoring panel reported early indications that ortho resins are firming. The November styrene contract was fixed EUR 4/t higher versus October, which seems to indicate production cuts and maintenance turnarounds are indeed having an effect.

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 2022: Further discounts on all grades / Weak demand prevents transfer of high energy costs / Recyclers shut down plants / Downward pressure continues

In October 2022, all recyclate grades slumped further. The broad downward trend of the previous month continued unabated, which was mainly attributable to weak demand: fears of recession are downright choking off demand from many end markets. The situation for recyclates is exacerbated by competition from low-priced virgin material.

The significant drop in sales in October meant recyclers were unable to transfer their high energy costs. As a result, profitability is suffering. With the energy-intensive production becoming less and less worthwhile, industry players are increasingly shutting down their recycling lines. Or even entire plants.

However, the pace of production cuts cannot keep up with the dwindling demand for all grades. As a result, recyclers will probably have to make further price concessions in November to sell material. At the same time, more recycling plants will be shut down to finally bring output in line with the scarce demand.

More and more recyclers will thus be drawing on their reserves. Those industry players who already have a financially strong owner or investor behind them can therefore count themselves lucky. Many smaller, independent recycling companies, on the other hand, are likely to increasingly flounder as a result of the difficult market situation, which could lead to further consolidation in the industry.

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 2022: Downward trend loses energy / General shift towards price stability / Recycling companies, converters bear difficult cost situation

The downward price trend for engineering recyclate slowed considerably in October. Although prices for most materials eased again because of generally weak demand, the size of reductions was generally smaller than before, and some grades of rPA 6 and rPA 6.6 ended up in a rollover.

Falling consumption of virgin material has led to a situation where recyclers are finding it difficult to obtain enough base material. On the other hand, demand for recyclate is so poor that this barely affects the generally balanced market situation. There was a slight increase in the number of orders being called off, especially from the automotive sector, but there can be no talk here of a real recovery.

For November, signs point to a difficult round of negotiations as recyclers should really at last have their high costs factored in. On the other hand, converters are fighting for every euro in price cuts. In the end, many prices will be largely unchanged because there is little room for any concessions from recycling companies or converters.

Many players on both sides have their backs to the wall and are fighting for economic survival. The probable rollover in November will not help either side: even if recyclers and converters hope they can somehow get through the present difficult situation until there is a significant demand revival, a true wave of consolidation in either direction is only really being postponed.

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!