Waiting for the season...

Last week almost everyone, who could do, was on holiday, there were just a few buyers  , thus active demand was low, we also received less specific numbers and opinions than usually, but our partners are rather curious to know what kind of prices can be anticipated in September?

On the feedstock side the following tendencies shall be considered:

The price of crude oil dropped below 100 USD, the price of refinery products, thus also that of naphtha followed in July in the Atlantic region (Europe - USA). The drop of monomer prices in August (Ethylene - C2.15, propylene - C3-20 €/ton) is also due to this. The question is, if the monomer price drop will continue? And will polymer prices follow this in the region? The examination of the change of monomer prices is not our competence, but we note that according to analysts in WE a further drop of monomer prices is to be expected.

In the second half of August there was a low demand and slow polymer price erosion on the market of polymers, there was a drop of  10 € in case of polyethylene and of 10-15 € in case of polypropylenes, following with delay the price drop that happened early during the month in WE. This price drop was nothing else but the delayed follow-up of the WE trends experienced early August. However the price drop did not generate new demand.

According to the expectations of plastic converters the demand is expected to increase after the 25th, as preparation for the September season, but on the other side there is no significant feedstock supply. This means that for plastic converters next week will be a shortage period. It will be in vain that the capacities of the region will be restarted during the last week of August, for normal supply still 2-3 weeks have to pass. In this way the first week of September will probably not be smooth.

However regional producers cannot ignore the price changes of monomers either. Basically we anticipate two scenarios:

·         In case of monomer price drop regional producers will not completely follow this and they will implement a price decrease by 10-15 €/ton lower in case of polyethylene, and by 15-20 €/ton lower in case of PP, that is the price compared to the monomer price will rather increase.

·         Also in case of monomer price increase they will try to increase the relative price, but the maximum of this will be only 5-10 €/ton both in case of PE and PP.

All this is supported by the fact that the plastic converters in the region expect a good season in September, they are of opinion that this season can last until the end of November.

Download Excel report on Polymer Prices

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László Budy
Managing Director
[email protected]
Mobil:     +36-70-368-5140
Tel/Fax:  +36-46-781-645