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Engineering Polymers - Europe December 2019

by Marta Rotini - mrotini@chemorbis.com
  • 19/12/2019 (14:17)

Month: December 2019
€/ton €/ton
Polymer MinMax
EPS10401190
PA 617701950
PA 6,6 32503780
PC 17502000
SAN 15501670
PBT22002250
POM 15801650
PMMA 2750 3100



EPS market sees further reductions in December

In the EPS market, players reported to have concluded their December deals with decreases between €30/ton and €50/ton. This is mainly due to the reductions in the December styrene monomer contract, which settled with a drop of €47/ton compared to November. As EPS prices reached quite low levels, several buyers decided to purchase extra volumes amid an awaited rebound in the EPS prices for the beginning of 2020 despite the shortness of the month in terms of working days and calmer demand. A converter commented, “We decided to build our stocks given expectations of seeing an increase in the EPS prices after 3 months of reductions, sustained also by possible small increases in the January monomer contract as well as squeezed margins.” As for EPS black/grey non-flammable, the overall range was reported down of around €30/ton from November at €1260-1290/ton FD. In the import market, meanwhile, a buyer said to have received an offer for Iranian material down by €40/ton at €1000-1030/ton for EPS white regular, on DDP basis. Players have already expressed their expectations for January, which are calling for hikes of around €30/ton in the styrene monomer and possibly in the EPS market. Yet, some converters do not exclude to see a rebound in prices only in February, when the high season for EPS products starts.


PA6 prices decrease despite higher Dec benzene contract

Even though December benzene contract settled with an increase of €70/ton with respect to November, PA6 prices saw mainly softer prices, especially in the compound sector, where decreases of up to €50-70/ton were reported. Buyers reported to have secured material mainly on their needs-only basis, paying for reductions of around €20-30/ton while rollovers have been reported only in a few deals. A converter in Italy said, “Some producers offered material with aggressive prices in order to entice their sales given the year-end despite the quite balanced supply-demand dynamics.” Players now shifted their attention to January, with first expectations calling for a possible rebound in PA6 prices given buyers’ need to restock material, firmer energy complex and large increases in the spot benzene prices over the month. Yet, some players do not exclude the possibility of seeing stability as the new year opens given flat demand after Christmas festivities.

PA66 deals closed with rollovers to reductions

PA66 business was wrapped up with stable to lower prices this month, after the December butadiene contract settled with a decrease of €50/ton compared to November. A South European supplier commented, “We applied small reductions of €10-20/ton this month. Yet, we are optimistic about 2020 as converters may need to build their stocks if demand recovers. Moreover, the prolonged maintenance at a European ADN producer may push PA66 prices up.” During the last part of the year, buyers preferred to destock and secure material on their needs-only basis given the negative sentiment amid poor demand in the leading automotive sector. Even though supply-demand dynamics were quite balanced, prices decreased. As for January, buying sentiment in the automotive sector will partly determine the PA66 trend together with the butadiene contract. Stability in spot monomer prices as well as more than comfortable supply may weigh on the January outcome.

PC market reaches low price levels

As it was anticipated in the last analysis, PC prices remained stable in December despite the large increase of €70/ton in the last benzene contract settlement. A converter stated that demand was poor given the year-end period. He added, “We secured material on a hand to mouth basis even though our suppliers were conceding to some discounts in order to deplete their allocations.” According to several players, PC prices reached quite low levels during the 2019, with very squeezed margins from the suppliers’ side. As for 2020, first expectations are calling mainly for stability in January given the shortness of the month especially in Southern Europe and calm demand after the Christmas break. Yet, it should be taken into account also the outcome of the next benzene contract, which may see increases given the significant hikes in the spot market during the month.

PBT business closed with rollovers

In the PBT market, players reported to have concluded their deals with rollovers also this month. Demand was lackluster given the approaching festivities in the region as well as the lack of support from the automotive sector. Supply, on the contrary, was reported to be balanced with overall buying interest. As for January, players started to express the possibility of seeing stability in PBT prices amid the lack of bullish factors.

POM market follows mostly a stable trend

POM deals were concluded mainly with rollovers this month. Only a South Korean supplier was reported to have decreased his prices of €50/ton for December. Trading activities remained calm this month given the low season, with buyers skipping their purchases or securing only their needs. A converter reported to have received an offer from South Korea at €1400/ton, on a DDP basis with delivery in February, but he decided not to purchase material this month, keeping his stocks at low levels. In January, POM prices may not see major changes given possible calmer market activities.

PMMA deals closed at unchanged levels on stable feedstocks

Players concluded their December deals with rollovers on the heels of stable MMA feedstock costs. The shortness of the month as well as the nearing Christmas break weighed on overall buying sentiment, which was lackluster. Yet, market participants are already focused on January as they started negotiations with their suppliers. A few producers have already announced decreases between €50/ton and €60/ton in their new prices given the lack of support from demand, which is expected to be flat in the first quarter of 2020. As a consequence, sellers are expected to focus more on volumes than prices next year, a distributor of a West European supplier commented.

SAN prices post small drops on lower SM contract

SAN deals were wrapped up mainly with reductions of €30/ton this month after the December styrene contract settled with a decrease of €47/ton. Only a few resellers reported to have sold their material at stable prices on the month. As supply-demand dynamics were unbalanced, with a poor buying sentiment typical of the year-end period versus a comfortable supply, a few sellers were open to negotiate their prices. Yet, some buyers decided to skip their purchases in order to keep their stocks quite low, waiting for January to secure material. Players do not exclude to see small hikes in January given the possible firmer settlement of the styrene contract on the heels of the large hikes posted by spot prices over the month. However, the SAN trend will depend also on the state of demand, which may remain calm given the holiday lull after the regional festivities, especially in South European countries.

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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