Price Reports November 2016

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!

Articles: November 2015
Standards Thermoplastics Engineering thermoplastics Polyurethane Feedstocks	Composites/GRP Standard Recyclate Engineering Recyclate

 

Standard Thermoplastics November 2015: Trend towards tightness supports polyolefin producers' efforts to lift margins / PVC caught in a weak rollover/ PS and PET increase slightly / Further upward momentum in December

PE: November confirmed that the developments in spring this year were not a one-off, but that epoch-making changes have since taken place, resulting in the creation of a "new normal" for European PE markets. Producers were unfazed by the fact that the monthly ethylene reference price rolled over, and proceeded to lift prices across the board. Their main justification for doing so is the market’s increasing tightness and the resulting delicate balance between supply and demand.

The supply shortage was the result of output restrictions imposed at various production sites, coupled with the fact that European price levels are currently too low to attract any imports that might be able to balance things out. The latter is largely to blame on the cumbersome EU import duties. Making matters worse was the fact that demand was unusually lively for this time of year, supplemented by purchasers’ attempts to keep their inventories at a safe level.

The existing situation is expected to continue into December. Film manufacturers have their hands full, and many are even questioning whether they should shut their plants down between Christmas and New Year. There are no signs that supply will improve in the near future. On the contrary, producers are already saying that come mid-December, it will become increasingly difficult from a logistical standpoint to meet delivery targets. This might well trigger a bout of reserve buying, not least since it looks as though notations will continue to rise in January. All of this means it is very likely that prices will increase again – a highly unusual phenomenon for a December.

PP: Those who might have hoped to see the European PP market return to normal in December hoped in vain. What last spring appeared to be an unusual phenomenon revealed itself as a methodically planned game change. Producers resolutely turned away from their earlier focus on recouping costs and reoriented themselves toward restoring the high margins for standard polymer they enjoyed in spring. Compounds notations remained relatively stable but began to show some upward momentum.

The supply side’s offensive was accompanied by a systematic pruning of the portfolio of low-margin products, mainly by curbing output of simpler polymer grades subject to intense competition. This consolidative approach could spell the end of several older production facilities in the not too distant future. Against this backdrop, demand in November was relatively robust, with the end markets continuing to order well.

As the propylene contract price rolled over, the PP market leader announced it was putting customers on allocation – see PIEWeb of 20.11.2015. Many film converters want to keep some production lines running during the upcoming holidays to meet strong demand; thus, it is not unlikely that prices will rise even in the short production month of December.

PVC: European PVC suppliers were unable to fully realise their targeted rollover in November 2015, and notations for high-priced base grade in particular shed a few feathers. The softening in C3-based additive costs also lowered the price of compounds. By contrast, notations for paste grades – E-PVC prime among them – held stable.

Demand was surprisingly strong for a November. The mild weather and several catch-up projects from the spring resulted in lively order activity from the end markets. Producers were mostly able to meet demand without difficulties.

December’s ethylene contract rose by EUR 22.5/t. Producers will of course try to pass on their proportionate share but their chances at success are slim. Amid the upcoming end-of-year holidays, notations will most likely roll over.

Styrenics: Following the EUR 30/t fall in the monthly SM notation, styrenics prices showed differing trends in November 2015. PS was particularly tight, allowing several suppliers to push through hikes even though costs had receded. ABS prices, by contrast, largely treaded water, although a few peak prices were capped as the impact of October’s significant price decline began to make itself felt. EPS prices, on the other hand, fell slightly across the board. Suppliers nevertheless succeeded at improving their margins somewhat by passing on only part of the cost reductions – the exceptionally strong level of demand aided them in their endeavour.

Looking ahead to December, notations are expected to rise slightly across the board. After several months of decline, the monthly styrene contract price has finally bottomed out, and producers will insist on passing on at least the EUR 35/t cost increase. The fact that availability remains tight plays into their hands.

PET: There were no noteworthy changes in European PET prices in November. Contrary to earlier expectations, PX notations rose slightly, adding EUR 15/t. Buyers of bulk volumes bore the brunt of the feedstock rise, at least part of which was passed on. On the regrind front, food-contact grades rolled over in mid-month, indicating that markets have firmed. The price of mixed recyclate, by contrast, fell slightly as notations caught up with the previous declines in virgin material prices.

Maintenance turnarounds tightened European PET availability, and Asian material also became increasingly scarce. Processors continued to place orders, since many of them saw prices as having bottomed out. All signs currently point to a rollover in December, when limited supply will meet with the usual end-of-year drop in demand.

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 November 2015: Notations continue to crumble / Polyamides increasingly under pressure / Further erosion in PC and PMMA / Trends likely to continue in December

As expected, engineering thermoplastics prices fell slightly in November, taking their cue from the earlier decline in feedstock notations. In addition, there are signs that a noticeable shift is taking place in the polyamide market, with the competitive pressure exerted by new Asian capacities now also having affected base PA 6 grades. This effect had previously been limited to feedstock caprolactam. A rising number of former export quotas are being returned to the European market, as Asian demand is increasingly met by local producers. The resultant undertow in the polyamide markets has also impacted the related PA 6.6.

There were also minor corrections in PC and PMMA notations, while the more commodity-related ABS (see PIEWeb of 03.12.2015) and PP compounds (see PIEWeb of 03.12.2015) stopped the downtrend, and in some cases have even started to move in the opposite direction. POM and PBT still seemed immune to any weakness.

The current trends for the respective types will likely continue in December. While ABS and PP compounds notations are expected to point further up, polyamide prices will continue to fall. Additional downward corrections also seem possible for PC and PMMA, while PBT and POM appear to be trending stable.

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 November 2015: Slight decreases across the board / Overall demand reasonably good / December will bring another downturn for TDI and rollover for all other materials

All monitored isocyanates and polyols again trended slightly downwards in November, even if decreases have become significantly smaller than in the previous month.

Still, producers have more mixed feelings than a look at prices alone would suggest. Rising notations for benzene have caused unrest in November, especially since they reached and then surpassed EUR 600/t on the spot market. In and of itself, this would constitute an argument for increasing prices, but the weakening demand typical of the short production months of December and January and relatively good availability speak against hikes. Nevertheless, high producer margins for MDI could drive processors to push for further discounts. All considered, widespread rollovers with minor fluctuations in both directions are the most likely outcome. Polyols should see comparable developments.

TDI, however, will most likely see further slight price decreases, even if its feedstock toluene might have lost only mildly in the two months following the strong September dip. A major reason is the start of production at BASF’s Ludwigshafen plant on 17 November, which could significantly increase supply to a market already having very high availability levels, which could create oversupply.

Even if overall supply is reasonably good, processors are already anticipating the low at the end of the year, which causes a certain cautiousness. The main market drivers are the automotive and industrial insulation industries.

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 November 2015: Slide in resins notations slows slightly / Still room for further declines / Demand expected to fall / Glass fibre products still stable but firming

Notations for medium reactive ortho resins gave way by another EUR 40/t on average in November. This was more than had been expected. The decline in particular affected notations for resin products located at the upper end of the PIE price range, with the downward momentum increasing as the month wore on. While the upper end of the scale seems to have some room at the top, the lower end appears to be bottoming out. The main feedstock, styrene, lost only minimal ground in November, which suggests that declining demand played a role.

Prices for glass fibre products remained largely unchanged. Here and there, buyers had to pay a few cents more for higher-end direct roving. However, the trend was not pronounced enough to influence the PIE range.

A further slight decline in resins prices seems possible in December. Styrene spot prices are currently trending stable, while the monthly SM contract rose by EUR 35/t, more than compensating for the setback in November. In the end, the determining factor will likely be faltering demand for resins in December. In addition, the two other feedstocks – maleic anyhdride and phthalic anhydride – have recently taken substantial hits.

Demand could fall substantially below the November level and also below December of previous years, due to the weakening of the automotive industry. Volkswagen, for example, plans to extend its holiday break into January.

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 November 2015: No major movements / Neat scrap trends upward / Mixed regrind sees further erosion / Across-the-board hikes in sight for December

Notations for standard thermoplastics reyclate moved in two different directions in November. Prices for neat polymer grades rose slightly, copying developments in the primary market, while price erosion of mixed regrind continued. This was due for the most part to seasonal effects – in particular for rHDPE and rPET – or lower costs at producers. Base material was usually sufficiently available, so that recycling lines could be operated normally.

Rising prices for virgin polymer will probably also pull up most recyclate prices upward in the weeks to come. This could prompt some players to refill inventories even before the upcoming annual revision.

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 November 2015: Downtrend in unreinforced rPA continues / Other grades mostly roll over / Availability suffices to meet stable demand / Processors busy securing volumes for January

Aside from unreinforced rPA types, notations for all other engineering recyclates trended sideways in November. Black POM recyclate prices rose slightly.

The fall on feedstock notations, which in turn led virgin material prices to ease, also drove down notations for unreinforced PA 6 and PA 6.6. While this slowed the decline in rPA 6 prices somewhat, rPA 6.6 grades actually only began their descent in earnest in November.

Demand was mostly stable and availability of production scrap sufficed to meet it. At times the input material even appeared rather long.

Notations are expected to move mostly sideways until the end of this year. However, the abundance in virgin material is pressuring rPA 6 grades, while the large gap to the primary market is keeping rPA 6.6 under some tension. Purchasing activity for end-of-year orders is still normal, and beyond that recyclers have already received a surprisingly high amount of orders for January, too.

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!