Price Reports March 2014

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!

Standard Thermoplastics March 2014:  Drop in PE notations exceeds ethylene decline / PVC still weak / PP remains stable / Styrenics follow downward feedstock costs / PET in free fall / Prices likely to firm in April

PPE: The European polyethylene market in March 2014 once again showed two different faces. Producers were forced to acknowledge that they had ramped up production a little too much in February. With plenty of material on the market, PE spot notations quickly caved in, which in turn raised contract customers’ expectations. By mid-month, producers had managed to get a better grip on the situation. After having implemented production cutbacks, some of them even turned down additional orders, while traders' stocks were emptied just as quickly as they had been filled. All these countermeasures, however, came too late for regular orders, most of which had been confirmed at the ethylene cost decline. Additional material, on the other hand, was only available at higher prices – if at all. Looking towards April, one can safely say that the operation has been successful. Despite a renewed fall in the ethylene contract, producers are sticking to their call for an extra EUR 40/t for all PE types and most could succeed this time around. Their strategy of actively controlling the amount of material put on the market seems to have worked, not least since demand remains lively and is unlikely to be much affected by the Easter break. It is thus quite likely that prices will rise, at least moderately.

PP: As the propylene reference contract rolled over from February to March, producers of standard PP also had to be content with a rollover. For top-up orders, however, they were able to push through hikes of EUR 20/t, in particular where customers were paying low prices. For PP engineering compounds there was no movement, thanks as usual to contracts indexed to C3. Over the course of March, supply bottlenecks for standard PP drove spot prices higher. The tightness at the polymer end reflected developments upstream. Because of the slow ethylene off-take that followed the brief February rally, some cracker operators reduced capacity utilisation rates again. In the face of normal to strong demand, this carved deep gashes into propylene supply. In April, all commodities along the propylene chain are under intense upward pressure. Propylene is up EUR 10/t, and PP producers hopeful of improving margins will try to seize the opportunity to lift prices by EUR 30/t. Their chances of success are relatively good. PP compounds, by contrast, are likely to continue moving sideways.

PVC: Although producers fought tooth and nail over every euro, they were unable to realise their March calls for S-PVC price hikes and in fact had to concede a large part of the proportionate decline for ethylene, which makes up about 50% in the vinyls cost mix. With additive prices largely stable, PVC compound notations declined by the respective drop in the cost of the matrix material. Suppliers of PVC pastes, however, had to pass on the full ethylene cost reduction. As a result, PVC producers – most of which are integrated in the chlorine chain – remained stuck with the minimal revenues for caustic soda. Although it appears as that, following a year of successive declines, the latter has finally bottomed out, there are no signs that prices will rise anytime soon. Coupled with a renewed decline in the ethylene contract, the structurally long supply situation will make it hard for suppliers to turn a profit. Even though the construction season is about to begin, all signs point to a weak rollover in April.

PS: The EUR 57/t decline in March's styrene reference contract pulled styrenics notations downward. PS and ABS followed SM, with producers’ attempts to pocket a part of their cost reduction thwarted by cheap imports. Only EPS producers were able to achieve margin gains, as demand from the building sector began to pick up. A major EPS producer’s switch to the new polymeric flame retardant sharpened pricing dynamics. ABS and EPS volumes moved well in March, while weak demand curbed PS off-take. On the whole, styrenics producers had matched output relatively well to demand, so that the market remained more or less in balance. As in previous months, price movements for styrenic polymers in April will closely reflect the development of styrene costs. Thus, the EUR 15/t increase in the SM reference contract can be expected to translate into slightly higher prices at least for PS and ABS. Hikes for EPS could be somewhat steeper as demand from the building industry gains additional momentum, and the substitution of polymeric for HBCD flame retardants continues to shake up the market.

PET: European PET prices showed further substantial declines in March. The cost decline of nearly EUR 170/t for principal feedstock paraxylene (PX) seen in February and March, in combination with a still oversupplied market, made the downswing inevitable. In North America and Asia, the same trend was seen, although toward the end of the month, the latter region saw some signs of stabilisation. The lower PX price in March will put further sharp downward pressure on PET notations in April. Even with the revival of the beverage season, the presence of imports from outside Europe will do nothing to relieve the oversupply situation for bottle polymer. The same can be said for the perspective of new capacities coming on stream over the course of the year in Europe as well as on its boundaries.

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 March 2014: Benzene derivatives show first signs of a rise / Livelier demand / Imports quash producers' hopes of lifting price of standard materials / Hikes likely as new quarter gets underway

The upward trend in European engineering thermoplastics prices, which first became apparent in February, continued into March. The surge was led by benzene-based materials. Although the availability of cheap import alternatives kept the rises for both PC and POM in check, notations for more specialised or reinforced grades also rose before the new quarter even got underway. There was a clear upward trend for the entire polyamide portfolio.

PMMA producers were still waiting in the wings with price initiatives, holding back until the onset of the new quarter. PBT notations also remained stable. Following the global decline in the relevant feedstocks, the price of engineering polyester grades started to crumble. As for styrene copolymers, ABS prices followed in the footsteps of the SM decline. By contrast, stable feedstock prices meant PP compound notations actually stayed put.

With a view towards April and beyond, prices of benzene derivatives and POM at least are likely to rise across a broad front. The stability afforded by the earlier Q1 contracts has dissipated, as many agreements for the new quarter have already been fixed at a higher rate, while players are still in the midst of discussing the extent of the hike for other quarterly contracts. The upward momentum will also affect the freely negotiated monthly orders reflected by the PIE ranges. The commodity-related ABS and PP segments are also looking firmer. The only product to buck the trend is PBT, where lower costs continue to exert downward pressure.

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 March 2014: Price trend begins turning around / MDI and polyols mostly firm / TDI points down slightly / Producers seek to pass on cumulative cost rise / Hikes likely in April

In March, the price trend for European polyurethane feedstocks continued pointing downward. Only in a few cases were MDI producers able to push through minimal hikes to recoup part of the cumulative cost increase of the past months. As benzene tumbled from its lofty peak, this aromatic could no no longer support price stability. At the same time, toluene eased, too, pulling TDI with it. Although the fall was not as steep as a month earlier, the downswing clearly was halted. Rigid polyols were still caught in a rollover, while flexible grades saw minimal upward momentum. With costs stable, the market began to tighten slightly.

In all likelihood, the arrival of spring will boost demand in April, and producers will seize the opportunity to bolster their sagging margins. For MDI substantial hikes can be expected, while TDI notations will undoubtedly stabilise. All polyols products are likely to see at least moderate upward momentum.

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 March 2014: Ortho resins notations unchanged despite lower feedstock costs / Most glass fibre products move sideways / Strong demand expected in April

Notations for most ortho resins products remained unchanged in March. A few smaller buyers paying prices at the lower end of the PIE range saw some upward pressure, but in general the market moved sideways. The steep plunge in March's reference contract for principal feedstock styrene had no impact on composite resins.

No supply bottlenecks were reported to PIE in March. It appears that there was sufficent material in the market to meet the higher demand from all customer sectors, in particular building and automotive. Cheaper styrene and stable propylene could weaken resins prices somewhat in April. However, strong demand at the beginning of the month could dash any hopes of price relief.

Among the glass fibre products, only roving and higher-quality chopped strand mats – the latter has no effect on the PIE calculation – saw slight upward momentum at the lower end of the range. It appears that some producers were able to push through minimal price increases here and there.


Up to mid-March, when the "JEC Composites" show (www.jeccomposites.com) begins, producers are unlikely to have any price increases up their collective sleeve. This will allow them to sidestep any difficult discussions at their booths. Later, as spring demand begins to kick in, they will be holding the longer end of the stick. Orders from the automotive and utility vehicle sectors are picking up. Here and there, the wind energy sector, too, is gathering speed, and the market for recreational vehicles will be gearing up soon.

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 March 2014: Declining virgin material prices prevent costs from being passed on / Orders from the construction sector remain solid / rPET demand restrained / Recyclers plan significant hikes in the new quarter

NEW: Notations for rPET grades
PIE has begun reporting prices for three PET regrind materials: rPET clear (ready-to-use recyclate for bottles and film), rPET flakes clear (mainly used for film) and rPET flakes coloured (mainly used for straps). As always, PIE prices are sourced both from web-based and personal consultations with market players. The new reports follow a prolonged period of trial and discussion.


Most recyclers were content with the volume of orders received, with some players telling PIE that they anticipate extraordinarily high sales levels for Q1 2014. Demand for recyclate used in construction applications was particularly strong. Standard thermoplastics recyclers, however, were less happy about the price development. The decline in virgin material notations in many cases put paid to their efforts to lift prices – even though recyclers had to pay more for production scrap and German players have to make do without the renewable energy subsidy. The large price gap to the primary market nevertheless afforded a protective umbrella, as a result of which the virgin material declines largely left recyclate notations untouched. The exception was rPET flakes, producers of which felt the twin pressures of declining virgin material prices and rising bottle scrap costs.

Demand for polyolefin recyclate remained strong. Orders of rPS – where the primary market declines were the greatest – did not cave in. The exception once again was PET, as buyers of rPET flakes held back on ordering in the hopes that prices would decline further. Most recyclate lines were operating at normal capacity, with producers able to deliver on time.

Recyclers plan to start the new quarter with across-the-board increases of up to EUR 40/t. They are pointing to rising scrap costs, with German players saying they have to make up for the end to the renewable energy subsidy. Aside from rPET, which is feeling the pressure of the primary market, all other recyclate grades covered by PIE could see substantial increases in April.