Engineering Polymers - Europe April 2019
|Month: April 2019|
EPS market retains its firmness in April on higher SM despite calm demand
The EPS market retained its firmer trend in April on the heels of monthly styrene contracts that settled €97.50/ton higher in Europe. However, sellers failed to reflect the full styrene upsurge on their April EPS prices, as it was the case in March. Players reported increases of €70-80/ton passing on April EPS deals. Meanwhile, the overall range for EPS black/grey non-flammable was reported at €1500-1600/ton in April. Demand has cooled off this month as many buyers built some stocks in March in anticipation of the firmer trend in April. Accordingly, a few buyers skipped fresh purchases this month and others have limited their purchases to their urgent needs. In terms of supply, no issues were reported for white EPS products while the force majeure on certain EPS grades declared by Total from its plant in Feluy, Belgium on April the 1st affected the availability of grey EPS grades, which was short this month, and increases of up to €100/ton passed on April deals, according to market sources. In the import market, in the meantime, EPS white regular and non-flammable from Iran emerged at €1270-1320/ton, on DDP basis, indicating €40-60/ton hikes compared to the most recent import price levels in March. As for May, stronger energy complex and slightly higher spot styrene prices are expected to pave the way for small increases on the awaited monomer settlement. Expectations are mostly calling for increases between €30-50/ton on May styrene contracts, with a few sellers voicing their intention to improve their margins, pointing to the expectations of better demand in line with high season and buyers’ needs to replenish their stocks.
PA6 holds mostly stable, small discounts on a few deals
PA6 prices followed a mostly stable trend in April despite the higher benzene contracts, which settled up by €82/ton in Europe, and average increases of €25/ton in the caprolactam market, according to sources. A distributor of a South European producer reported, “Our supplier has initially attempted to apply small increases on his April PA6 prices, but he failed to obtain any hikes due to unresponsive demand. Accordingly, we have concluded our April business at mostly stable prices.” The lack of supply issues in the market and calm demand have continued to overwhelm the stronger upstream costs this month, preventing PA6 prices from rising. In the meantime, a compounder reported to have skipped its fresh purchases in April as his current stocks are sufficient. Within the overall price ranges, a few sellers even reported slight discounts of around €50/ton on their April deals in order to attract buyers’ interest, which however remained quite low. The slack performance in the automotive sector is said to be one of the key factors which hampered any possible hikes in the market. As for May, benzene contracts settled up by €40/ton early this week; however, most players expect that prices may hover at around their current levels given weak fundamentals.
PA66 market retreats on weak demand
Easing supply issues and persistently weak demand, especially from the automotive sector, have led to further softening in the PA66 market in April. Surging costs have failed to drive the market up this month and different sellers reported that their official price lists were mostly stable; however, they have conceded to special discounts in order to conclude deals. A few suppliers shared similar comments, saying, “We registered an erosion on PA66 prices in April despite the higher butadiene contracts which settled up by €40/ton in Europe, with the low ends of prices of virgin resin reaching the €4000/ton threshold.” A few distributors of different European producers, meanwhile, commented that they were open to negotiate on their prices in case of firm bids from buyers’ side as demand from the main application sectors has not picked up yet. As for May, expectations are mostly centered on a stable to possibly slightly softer trend given the unchanged May butadiene contracts and weak fundamentals.
Stability dominates European PC, S. Korean material remains on a firmer note
The PC market remained mostly stable in April on the back of thin demand and comfortable supply in the region. Plus, April was a short month in terms of working days and many players have preferred to limit or skip their purchases. Accordingly, distributors of different European producers reported to have mostly maintained their April PC prices, pointing to the hefty price decreases they had conceded to during the past few months. On the buyers’ side, a compounder reported to have avoided to buy beyond his urgent April needs, which were very limited, while a few different converters confirmed the stable trend in the local PC market in April. As for South Korean material, instead, a few traders reported a fresh round of price hikes for new shipments, with prices at €2250-2300/ton, on DDP basis, standing €100-150/ton above the European origins. Expectations are mostly calling for a stable trend in May as the stronger upstream costs may not overshadow the quiet market conditions.
PBT market remains flat in April amidst calm demand, sufficient supply
PBT prices did not post any changes and extended their stable trend into April, as was largely predicted in the last month’s analysis. Supply was said to be sufficient, while demand continued to be calm due to limited consumption from the key automotive sector. A few sources in the market reported that second-quarter contract prices for feedstock butaniedol have been settled with a decrease and lower feedstocks costs may impact PBT negotiations for the third quarter, according to a few players.
POM prices turn softer on lower feedstocks, weak demand
The POM market has turned softer in April as weaker demand and lower feedstock methanol costs have pulled prices down. Supply was said to be generally balanced, although a producer said there is some length in the market. A few sellers commented, “Our official price lists were stable in April; however, we conceded to some discounts due to weak market conditions.” Meanwhile, a trader offered locally held POM from South Korea at €1680-1700/ton, indicating decreases compared to March, citing the poor demand from converters’ side while a distributor of a South European producer lowered his April POM prices by €50-100/ton, citing the thin trading activities in April given Easter and a few different bank holidays in the region. As for May, players generally expect to see mostly stable prices.
PMMA extends its stable trend into April
PMMA prices remained mostly stable in April as fundamentals were balanced amidst calm demand and sufficient supply. Meanwhile, a distributor of a major West European producer reported to have applied small decreases on PMMA injection prices due to thin demand. Plus, Easter holidays pushed many buyers out of the market towards the end of the month and most of them limited or even postponed their fresh purchases to May, when prices may hover at around their current levels.
Sellers fail to reflect the full SM upsurge on April SAN prices
The SAN market extended its firmer trend into April following the higher styrene contracts which settled up by €97.50/ton in Europe. However, sellers failed to obtain their initial hike targets of €100/ton on their April SAN prices given buyers’ strong resistance stemming from unsupportive demand. Players reported that April deals have been concluded with increases of €70-80/ton over March. Expectations are mostly calling for fresh albeit smaller increases on May styrene contracts, which may settle up by €30-50/ton, while a few buyers believe that pressure may not be strong enough to push SAN prices up further in May as demand is not expected to significantly improve in the short term.
Price ranges reported include an average freight cost to the customers’ location as well as duties if applicable, although VAT is not included.
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