The latest pricing charts can be accessed here.
In September, European standard thermoplastics producers achieved small margin gains with most prices falling by less than the decrease in feedstock costs. This can be explained by tightening supply brought about by production cutbacks, a series of scheduled and unscheduled plant outages and fewer imports.
L/LDPE film prices increased by €10/tonne last month compared to the €25/tonne reduction for ethylene. HDPE prices were stable. PP prices fell by €20/tonne against a €30/tonne fall in the cost of propylene.
PVC prices are €10/tonne higher from August, despite a €12.5/tonne reduction in the cost base resulting from lower ethylene. PS prices were down in line with the €8/tonne fall in styrene monomer. PET bottle-grade prices were down by €30/tonne due to low demand and falling raw material costs.
Standard thermoplastics producers have also attempted to improve their underperforming margins once again this month, but have so far, with the exception of PVC, been rather less successful.
During the first two weeks of trading L/LDPE and HDPE prices have fallen close to the €32.5/tonne reduction in the cost of ethylene; PP prices are down by more than the €35/tonne drop in the propylene contract price and GPPS prices have fallen in line with the €202/tonne collapse in the styrene monomer reference price.
A combination of low-season demand, ample supply and falling feedstock costs have contributed to a further reduction in bottle-grade PET prices.
PVC has so far bucked the broader market trend with offers this month ranging from rollovers to slight increases month-on-month. This surprising resilience can be attributed to the margin recovery attempts that have been keeping the momentum tilted to the upside for the past couple of months.
Supply normal to tight
Polymer production plants continue to operate at reduced rates as producers maintain output in line with the ongoing weak demand. Supply has been further restricted by several planned and unplanned plant outages over the last two months. More competitively-priced imports are becoming more widely available because of declining freight rates.
A summary of selected supply-related developments is shown below;
- Vynova shut down its UK PVC/EDC plant on 10th October for maintenance
- Versalis S.p.A. is reported to have shut down its LDPE/EVA swing plant at Ragusa in Sicily for maintenance on 3rd October and is set to last for 50 days
- Vinnolit lifted the force majeure on PVC deliveries from its Knapsack plant on 24th September
- TotalEnergies announced the cancellation of the force majeure on polypropylene deliveries as of 19th September at plants in Feluy, Belgium and Gonfreville, France
- Versalis S.p.A. shut down its PP|PE plant in France for maintenance on 17th September
- A fire broke out at a domestic Versalis cracker in Brindisi, Italy on 16th September; the impact on production is unclear
- Ineos shut down its PP|PE cracker in the UK for maintenance on 16th September
Demand weak
Polymer demand has remained well below what would normally be expected during the months of September and October. Most converters report adequate stocks in view of the low demand across most end user sectors and are buying just sufficient material to cover their immediate production needs. In October, many converters started to keep a close eye on their end-of-year stock levels.
November outlook
No major movements in ethylene and propylene costs are expected. However, price development will likely be influenced by the outcome of the US presidential election and conflicts in the Middle East, which are creating uncertainty in the market.
The latest pricing charts can be accessed here.