Price Reports Abstract July 2013
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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! |
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Articles: July 2013 |
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Standards Thermoplastics |
Engineering Recyclate |
Standard Thermoplastics July 2013: All products rise despite stagnating costs / Market tight due to poor supply and normal demand / Monomer-plus-margin strategy drives calls for hikes
In July, the increasingly tight market situation lent momentum to European standard thermoplastics’ drive to push prices forward by as much as EUR 50/t at the beginning of Q3, despite largely stagnating monomer costs. Initially, converters were able to limit the extent of the hikes. However, the further tightening supply played into producers’ hands. The size of the July increases varied considerably as the market situation evolved. By August, the PIE ranges for LDPE, LLDPE and HDPE had risen by up to EUR 45/t, while tightness in PP moved the range upward by EUR 15/t. S-PVC base material climbed EUR 17.50/t. Even if styrenics were already expensive, the PIE range for PS added a further EUR 12.50/t. The increase for EPS was held to EUR 5/t, and was confined to insulation grade.Early in the month, numerous unexpected restrictions in feedstock supply – which inevitably had a limiting effect on polymerisation activities – led some producers to refuse orders beyond the initially forecast volumes. With output of PE, PP and PVC diminished, the supply picture worsened. Both seasonal influences and special price effects helped to fill the order books, and demand for most polymer types and grades was normal, despite many businesses taking their usual summer break.
Due in part to the mini rally upstream and the tight supply, monomer contract prices that been moving sideways for nearly three months increased in August. Ethylene (C2) was up EUR 40/t, propylene (C3) up EUR 50/t and styrene up EUR 47/t. Even though order volumes normally decline in August, producers intend to do more than just recoup their higher production costs this month. Accordingly, the first announcements of price hikes for August also contain a margin-improving component.
For PE, producers are targeting around EUR 100/t more, while PP producers are looking for EUR 70/t more. S-PVC base material suppliers want an extra EUR 50/t, while PS and EPS producers also will push for substantial increases. As supply will surely remain tight, price rises could certainly exceed production cost increases, even if this is unusual for the peak summer holiday month.
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 July 2013: Smooth Q3 transition / Most prices roll over / Slight drops in ABS and PP / No ordering slump / Despite declining feedstock costs, binding Q3 contracts dictate landscape
Apart from the rather tight situation with PBT and the ready availability of PP compounds, the supply situation for the other engineering thermoplastics was normal for a summer season. Though the Euro summer holiday period was in full swing, a surprisingly large number of market players were still in a buying mood, though not so much for PP compounds. August will not see any big summer lull, but producers have cut back on production output as they usually do for this time of year. On the cost side, butadiene notations plummeted once again by EUR 250/t, which is putting pressure on ABS and PA 6.6. PA 6 could also begin to wobble as a result of the price drop in benzene, though this was only half as much in August as it was in July.
Yet, MMA is on the up, and this could well push up PMMA prices. What is fairly certain is that notations for PP compounds will go up. With propylene now EUR 50/t more expensive than in July, the prices for automotive grades tied to this feedstock will certainly go up accordingly. Overall, however, there are unlikely to be any significant movements either way. With a rollover already agreed for many materials in longer-running contracts, this will probably set the pattern for freely negotiated prices.
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!
PET July 2013: Notations lose a little more ground / Trend reversed over the month / Summer weather improves market balance / Buyers open their wallets again / Imports decline
The direction of production costs in August is not yet clear, though moderate rises seem likely, due to higher oil prices. Thus, it remains to be seen whether PET producers pass on any higher costs. Much will depend on the weather-related seasonal demand. At the moment, it does not look as if producers will succeed in substantially adding to margins as the market is not completely back in balance.
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 July 2013: Rebates predominate / Only pure MDI stable / Poor seasonal demand leads to stock-building / Hike plans with little chance of acceptance
In July, notations for polyurethane feedstocks softened again. After the key aromatics benzene and toluene fell by 6-7%, TDI prices lost further ground, and polymeric MDI also was caught up in the downward spiral. Of the isocyanates, only pure MDI held its ground. The polyols also retreated again, despite the stability of propylene and ethylene.
Across the board, sales were below expectations, even for seasonal applications. As the volumes called off by customers were so low, producer inventories swelled considerably. Making matters worse, some previously idled production facilities were restarted. Though demand for building industry-oriented PU components improved in July, it still fell far short of the usual seasonal average. TDI orders also remained subdued, particularly as many buyers were playing a waiting game, speculating prices would continue to fall.
The trouble spots of the Middle East are driving oil prices higher, which could well translate into increases for olefins such as propylene and ethylene in August. Unlike Asia, where there is clear evidence of upward pressure, the European aromatics chain is currently still calm, but could well be shaken up farther down the road. As the summer holidays get under way in France, Italy and Spain, demand for PU products probably will decline even further. With supply in an already saturated market lengthening, PU feedstock producers will find it very difficult to pass on any cost increases.
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 July 2013: Ortho resins lose a little more ground, despite producers' hike plans / Stability expected in August / Glass fibre unchanged / First Egyptian direct roving shipments delayed
August saw a further slight decline in prices for medium-reactive ortho resins, but this was not as pronounced as many converters had hoped. Both ends of the PIE table for resins gave up around EUR 10/t, while prices for glass fibre products remained mostly unchanged. The market’s tension over when the first deliveries from the new Egyptian facility owned by Chinese fibreglass manufacturer Jushi Group could be expected gave way to disappointment as it was announced that the start of production would be delayed due to the continued political unrest – see PIEWeb of 05.08.2013.
Resins producers, for their part, tried to stem prices upward at least by a small margin, but enjoyed little success, especially as there was little support from the feedstock side, The July contracts for styrene and propylene (monopropylene glycol) showed at the most sluggish movement, and propylene remained unchanged. Styrene sank by EUR 4/t, which was hardly worth mentioning, while phthalic acid anhydride moved more sharply downward on the back of a EUR 40/t plunge for orthoxylene.
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 July 2013: Secondary market untouched by increases in primary segment / Only slight gains registered / Producer margins dramatically weak / Plans to leverage virgin hikes
In July, for the second consecutive month, producers of primary pushed through low single-digit price hikes, despite stagnant costs for feedstocks ethylene and propylene. Secondary producers in German-speaking Europe were still unable to turn the widening gap into a significant advantage, however. Demand was somewhat improved, but not enough to make a difference, even if some polyolefin recyclers did manage minor gains of EUR 5/t. Most notations rolled over from June, but price wars pushed translucent rLDPE even forward by EUR 15/t.
Recyclate was in sufficient supply to meet the slight increase in demand. Some producers even had significant volumes to flog. Restrictions on exports to China have begun swelling supply of spent polymer throughout Europe, but because the quality of some of the waste is unsuitable for production, recyclers still have to resort to their usual expensive procurement sources.
Demand in July is described by market players as being somewhat better than in June, with the building season finally in swing and the gap to virgin material widening. It does not seem enough to get excited about, though. Recyclers have told PIE that their customers’ forecasts for August suggest further better order intake. With margins having sunk continuously since the beginning of the year and the cumulative setback now at EUR 70/t, most players are in dire financial straits. Thus they hope to leverage the upward momentum on the primary market to correct their own prices upward.
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 July 2013: All quiet on the secondary engineering polymer front / Supply adequate to meet surprisingly robust demand / August might bring price hikes
Hard on the heels of the sluggish primary engineering thermoplastics market, business with their recycled counterparts in July was equally slow. Undaunted, customer markets continued to remain attentive. This is certainly good news, especially as the German auto industry performing better than expected and, contrary to original plans, many production lines are going to operate throughout the summer season without interruption. Notations for all engineering recyclate products still remained unchanged from mid-June to mid-July.
The supply situation was found itself once again having enough material produced to meet the surprisingly robust demand. Yet, regrinders found themselves having to write off their scheduled summer holiday plans and downtimes to cope with the extra orders.
Still, pressure is likely to grow on the recyclate market in August as there could well be a few bottlenecks with the supply of production scrap, and it might also be more expensive. Many companies in the various supply chains had prepared for a quieter summer and it will be difficult – if not impossible – for them to throw their plans overboard on the spur of the moment. A close watch will be needed, especially on rPC and rPP compounds and, to a lesser extent, also on rABS and rPA 6.
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!
