12.10.2022
Market in virtually unprecedented state of disruption / Cheap imports from Asia put prices under pressure / More production stoppages in the offing
The European market is in a state of disruption as seldom seen before. On the side of converters, the mood is worsening by the hour as almost nothing is moving forward. More and more engineering plastics material is being imported from Asia that is so cheap that the price spread is reaching absurd proportions. The reason for the imports are the lower logistical costs, which keep the arbitrage window wide open.
In the case of PC, European production was operating with small cutbacks, but output was nevertheless sufficient to fulfil contract obligations. With the benzene contract for October rising EUR 22/t, the lower output rates, in addition to the energy cost surcharges called for by producers, are likely to lead to significant price hikes this month. Imports could nevertheless possibly have a dampening effect.
The main worry as far as the converters are concerned continues to be the very poor demand. In some areas, it has slumped by up to 60%. One of the few exceptions is the lighting sector, which is currently experiencing a small boom whenever the application has something to do with saving energy. The rest of the E&E sector and car production is nevertheless very weak. Because converters are financially barely able to top up their stocks, the number of production line stoppages is expected to rise.
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