Price Reports October 2023

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 2023: At least there's one thing everyone agrees on – for all intents and purposes, the year is over / Producers, processors at odds over passing on feedstock prices / When will demand pick up again?

PE: After the announcement of the EUR 65/t increase in the ethylene contract in October, the course was set for producers to hike their prices for PE grades. Some of them took significantly more time than usual to put their offers on the market. Referring to the poor availability of a few materials in Europe and the unsatisfactory margin situation, it was not rare for producers to call for triple-digit rises – with some of them also being successful. Because of the long-lasting cutbacks in output at European plants, the first supply problems were reported for some speciality products. The consequence was that many orders could not be accepted but were cancelled or postponed. Orders for commodities, on the other hand, were met across the board. Converters reacted to the price increases by calling off their stocks, which they had wisely built up in the summer months, having anticipated rising prices and a miserable supply situation. For this reason, they ordered only what they absolutely needed. As before, capacity utilisation at many companies was unsatisfactory, and was at best the same as in the previous month. In November, the reduction in the monomer contract of EUR 45/t is expected to put significant pressure on polymer prices. In view of the tight supply with some materials, it is unlikely that this reduction will be factored in completely. Converters are, however, expected to take advantage of the start of the year-end talks to persuade producers to make concessions. Nevertheless, nothing very much is likely to change as regards the fundamental data this year.

PP: The EUR 60/t rise in the propylene contract served as the template for many transactions in Europe. Previously, producers tried in vain to push through triple-digit increases. In a few cases, contracts were sealed with more modest rises. The wheels of European production still lacked sufficient oil, with scheduled turnarounds and unplanned outages keeping supply reduced. It was enough to fulfill contract terms, however. Buyers who needed additional material had to be patient. Even imports didn't do much to improve availability. Not all converters were in the same boat. The scenarios they described ranged from cancelled orders and short-time working to a modest improvement that as still not entirely satisfactory. Those supplying the automotive sector were among the few who still saw a glimmer of hope. Demand from the packaging industry remained soft. And what’s next for November? The EUR 40/t drop in the cost of propylene is likely to send polymer prices plummeting again. Annual discussions and continued subdued order activity could even encourage some providers to offer deals to at least reduce their own inventories a little before the end of the year. Processors’ order books are not yet really full: requirements will at best stabilise at a low level. Nobody expects any improvement this year.

PVC: Prices in Europe rose slightly again, for the second month in succession. Producers took the increase in the ethylene contract (up EUR 65/t) in October as a guide and, in numerous contracts, this was priced in on a pro-rata basis at least. In the further course of the month, the hikes became less pronounced, however. European plants were still operating with their output curtailed to a minimum and the quantity of imported material on offer was smaller than in previous months. Despite this, sufficient volumes were available on the market as demand continued to be sluggish. New construction remains at a low level and only building renovation is generating a limited amount of momentum. Contrary to the case at 2022’s K trade fair in October, the start of annual talks has failed to provide the necessary ‘push’ factor. Processors held back at Fakuma and still proceeded with great caution when ordering material for the coming months. As far as the outlook for November is concerned, the clear drop in the C2 reference (down EUR 45/t) is set to exert pressure on prices again. A downward trend would thus seem likely.

Styrenics: The rise for styrene in October (up EUR 60/t) fuelled further price increases in the European market. Premiums, however, did not reach the full extent of the feedstock material, dashing producers’ hopes. The position of processors was very strong, supply good, and demand too low for that. As in the previous month, enough material was available. The lack of stimuli from consumer markets remained. By consequence, processors also placed only few orders and proceeded cautiously. The styrene reference for November is not yet available. However, spot prices have fallen significantly – in recent weeks, they followed the decline of feedstock materials benzene and ethylene, going down EUR 150/t. The SM contract is likely to also be headed this way. However, it is not to be expected that PS will also go down as much; producers will know how to prevent that. The situation is very similar for EPS insulation materials. Producers tried – daringly but in vain – to price in the October increase in the styrene reference. In this, they were thwarted by construction, one of the main consumer industries, as it is still down on the ground. In the end, they had to settle for premiums between EUR 20/t and EUR 40/t. Seasonal factors will likely aggravate the situation for insulation materials. Winter is an unlikely season to start construction projects; façade renovation also goes into hibernation.

PET: The ongoing misery in the European PET market appears to have reached a new peak in October. Demand remained well below the normal level at the start of the post-season period too. Midway through October, producer JBF Global announced that, for economic reasons, it would also be closing the second of its two lines in Geel, Belgium, at the end of the month. In the wake of this announcement, the still-relatively low number of contracts that were being concluded spanned a wide price range. All in all, European producers managed to pass on at least part of the PX cost increase in their regular business. As far as demand is concerned, market participants agree that nothing more can be expected this year. Later, JBF surprisingly announced that it would keep the second line in Geel running after all, so as not to leave customers completely out in the cold. The company did, however, specify that this could only be done on condition of acceptable feedstock prices. Attention then turns to the PX reference for October, which was not available at the time of going to press. Players are caught between a rock and a hard place here given the global oil price levels and slack demand. Tough wrangling is on the cards for November in light of the global situation, with presumably attractive import offers set to tip the balance.

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 2023: Further hikes in feedstock costs fail to raise prices / Weak demand, ample imports create liquid markets / No improvement in sight

The benzene contract for October rose an exorbitant EUR 232/t. For this reason, PC producers attempted to push through significantly higher prices. However, the high volume of imports and the languishing demand quickly ended their intentions. Although European plants are still operating with significant cutbacks, the market remained long because of the lively imports. The automotive industry is still weak, and the construction industry and E&E sector also need very little material. In November, the price of the feedstock dropped EUR 148/t compared with October. The next round of falling prices would therefore seem to be imminent.

For polyamide, the announcements by European PA 6 producers of wanting to push through triple-digit price increases because of the rise in the cost of caprolactam quickly came to nothing. Although these hikes were occasionally getting through at the beginning of the month, agreement was reached in most cases on price reductions. European producers are still operating with significant cutbacks in output, but, through an increase in the arrival of imports, a liquid market resulted. Nevertheless, many converters had to wait longer for speciality products than of late. Demand in the fields of construction and automotive was, as before, so poor that a few converters switched off their production lines or reduced shift work. In November, the shortage of specialities could push up prices, but the overall market will probably adopt a wait-and-see position. 

In the case of PMMA, miserable demand plus the large volume of imports sent prices tumbling once again. That will not change in November. Many order books are still exceptionally empty. Impulses from the automotive sector are virtually non-existent, and the weakness in the construction industry cannot be glossed over even in November by putting the blame on “seasonal effects”.

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 2023: Weak demand dominates market / TDI, polyols bottom out / Downward trend for MDI remains intact

The benzene contract, which was fixed at a startling EUR 232/t above the current level at the beginning of October, had hardly any impact on the isocyanates. To a large extent, the market was firmly in the stranglehold of weak demand. This meant that temptingly cheap imports led to further sharp markdowns for MDI grades. For TDI, on the other hand, the throttled European production showed results, which initially resulted in a rollover.

Demand did not recover in October, and this is not expected to change in the coming weeks. Occasional exceptions can be seen – for example for mattresses and luxury furniture – but these are not enough to really provide a boost. Order activity is expected to remain weak even well into the new year, according to reports.  

While prices for MDI are likely to continue their downward slide in the coming weeks, TDI and polyols should at least roll over or show noticeable increases. 

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 2023: Little momentum for resin, glass fibre / Cheaper styrene may prompt more rebates for resin in coming weeks / Approaching year-end is palpable

As had been anticipated, the downward trend in resin prices was halted in October, despite the rise in the monthly styrene contract. Amid the generally soft demand for finished resin formulations, the recent turbulence surrounding maleic- and phthalic acid anhydride (PSA) – triggered for the most part by the outage at a large PSA plant – didn’t have much of an impact. Some large accounts managed to wrangle bigger rebates, though most transactions closed somewhere between a rollover and very modest concessions.

The styrene reference contract for November was fixed EUR 149/t lower, following the spot prices, which have given way by EUR 124/t over the past four weeks. The contract decline could drive resin prices farther downward, especially as no improvement in demand appears to be on the horizon.

Glass fibre prices largely rolled over. The few rebates were generally small. Producers will do all they can to hold prices stable up to the end of the year. This won’t be easy, as the sluggish demand offers too little impetus.

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 2023: Market continues to bob along / Slight support from increased virgin material prices only for rPE / rPP, rPET still under pressure / Similar picture likely in November

The higher virgin material prices on the European market in October 2023 provided a basis for upticks only for rPE, and only to a lesser extent than recyclers had hoped for. For rPS,the previous downward trend has at least bottomed out, but rPP and rPET continued to lose ground in the face of weak demand and the prevailing oversupply.

The recyclers are on the ropes. Market players are waiting for politicians to finally set the finishing touch on sustainability regulations. But this is looking more and more like the notorious waiting for Godot.

With no signs of positive stimuli to be seen, the overall picture is unlikely to change much in November. The upshot: minimal price increases should again be possible for rPE, while rPP and rPET are likely to remain in their respective downtrends.

Recyclers’ margins are so emaciated at this point that they can no longer make any significant cuts. But the crux of the matter is that the situation is just as bad for many processors. Considering this mixed picture and the inadequate margins of recyclers, it seems to be only a matter of time until the market consolidates further. 

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 2023: Prices seem to be bottoming out / Demand remains weak / With imports declining, balance could slowly be restored

The still-weak demand and the abundance of cheap recyclate imports are exerting further pressure on Western European contract prices. So as not to lose their markets completely, European recyclers lowered their prices yet again. In many cases, there were even triple-digit reductions – especially with PA 6.6 materials. 

Many converters’ order books are filled no more than 60%, and Europe’s recycling and compounding plants are operating nearly everywhere with significant cutbacks in output. The liquid market is, however, barely affected by this because significant quantities of imports are streaming onto the continent. 

Converters do not expect any trend turnaround in demand for November. On the contrary, many fear that the war in Israel could lead to even greater purchasing restraint. 

For European recyclate producers, the end of the road has been more or less reached after the price cuts of the past few months. With the import pressure declining somewhat, November should once again see price reductions, but they will be much smaller than those of late. Exceptions are expected to be PA 6.6 and POM, for which the downward price spiral in November is likely to go into a new round. 

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!