PIE - Polymer Price Reports

Standard thermoplastics April 2024

Mark-ups on polymer prices remain mostly below the monomer´s / PVC, PS experience slight upward trend / Downward trend expected across all types in May

PE: Calls by some suppliers for price increases more than the EUR 40/t rise in the cost of the monomer were in most cases rejected by converters without argument. After all, demand also remained weak in April, and supply was additionally boosted by imports. As a result, prices for the readily available commodities increased only slightly. Specialities did not go along with this trend to quite such an extent because there was no competition from imports here, and producers were often able to factor in the full increase in the cost of C2. On the customer side, the food and beverage segment is beginning to buzz – thanks to the warm early-summer temperatures. Applications for the construction industry also picked up slightly due to the start of the season, as was evident in the pipe segment, among others. At present, new orders are only being placed on the basis of price. Overcharging will generally mean waiting in vain for orders, and business is also likely to remain very slack in May because – according to more than just economic experts – there is still far too little activity in the overall economy here. Not least for this reason, polyethylene prices in May are likely to be under pressure. Through the reduction of EUR 10/t in the C2 contract, the direction in which prices will move this month is more or less in the cards – namely downwards. 

PP: In April, weak demand and a better supply situation due to imports thwarted suppliers, who wanted to fully factor in the recent increase in the propylene reference price (up EUR 45/t) in April. In order to place volumes onto the market, they had to cut back on mark-up amounts and, in some cases, prices were simply carried forward at the previous month’s level. There was less pressure on specialities from European production due to a lack of alternatives. Demand was reduced not only by the fact that some processors resumed operations with a certain delay after the Easter holidays. They also speculated on falling prices in the summer and adjusted their order activity accordingly by drawing more heavily on their stocks. It seems they won’t have to wait long for prices to fall – the C3 reference fell by EUR 10/t in May. And as there is still a lack of momentum on the demand side, with new imports continuing to drift in, processors will probably be able to achieve discounts in May that go slightly beyond the monomer’s change. 

PVC: European PVC prices ticked slightly higher for the second month in a row. Most agreements passed on half the cost of the ethylene contract (up EUR 40/t). However, the range of increases in April was somewhat wider than in previous months. The reduced output of European facilities was sufficient to cover the weak demand. As before, only few converters turned to imports since they have no major advantage in terms of price. While noticeable here and there, the seasonal rise in demand that traditionally kicks off in April is considerably below usual levels. There’s still a lack of impetus from the large markets – France and Germany – but sales were somewhat better in neighbouring countries like the Netherlands and Poland. For the current month, it looks like the ethylene contract, which was fixed EUR 10/t lower, will end the uptrend in quotations. Producers are expected to try to keep the price level stable. Even if demand from converters picks up again, ordering is unlikely to be sufficient to result in a balanced market. Prices are consequently projected to decline again.

Styrenics: In April, the prices for styrenics trended upwards for the third month in a row, albeit not quite as strongly as in the two previous months. In the case of polystyrene, suppliers insisted on pricing in a large part, if not the entirety, of the increase in the styrene reference (up EUR 44/t). For ABS extrusion, the cost trend also served as a clear guideline for determining premiums. The situation was different for EPS and ABS injection moulding grades, where weak demand frequently led to more moderate price hikes or even a rollover. Demand for PS, EPS, or ABS is still not getting off the ground. There were occasional seasonal stimuli, but demand for all materials remained below the usual level. This was also because many processors limited their purchases to absolutely necessary volumes, as they did not expect the currently high price level to be sustainable – after all, the styrene-driven boom of the past three months made styrenics more expensive than they have been since autumn 2022 (ABS and EPS) or even August 2022 (PS). In fact, the processors were right – the styrene contract for May fell by EUR 111/t. As a consequence, styrenics prices are also expected to fall to an extent yet unknown, but it will be significant. It remains to be seen whether this will be considered a buying opportunity by processors. Should further discounts emerge for June, they are expected to keep the brakes on their order activity.

PET: After the turbulence of the previous two months, the European PET market shook itself to rights again somewhat in April 2024. With stagnating feedstock costs, European manufacturers were producing at a respectable level. Imports arrived, though they were significantly less attractive in terms of price due to the increasing cost of logistics on the long route from Asia. With demand still running at a relatively low level, European producers offered moderate reductions as an incentive. And this proved to be a successful approach, since converters opted for the quality-assured materials again on account of their competitive prices. Some realised that, with the Olympic Games in Paris and the European Football Championship in Germany, major events were coming up with potential to boost drinks consumption after all. The motto of market players for the month of May seems to be that things can remain just as they are. European volumes are sufficient to meet demand, the feedstock situation seems calm, and the major summer events and concert season are approaching. For the first time in a long while, optimism is beginning to spread again, even if at an understandably hesitant pace. Rollovers or no more than slight fluctuations are the most likely scenario.

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