Engineering Polymers - Europe July 2018
|Month: July 2018|
The EPS market turned softer in July following the styrene contracts that settled €50/ton down, defying the €37/ton higher benzene outcome in Europe for July. July EPS deals were mostly concluded with decreases of €40-50/ton over June with most converters having secured their monthly needs only. Meanwhile, Iranian EPS emerged at competitive levels in the import market this month. A few converters reported to have received offers at €1430-1440/ton DDP, standing €70-80/ton below the low end of the overall local ranges; however, these offers failed to grab buyers’ interest due to their reluctance to secure long distance cargos ahead of the long summer lull. Expectations are mostly centered on a stable to softer trend in August as the slowdown of activities during the summer holidays, the lack of supply concerns and the expected stable to lower styrene contracts may weigh down on the EPS market next month.
PA6 prices have mostly retained their stable trend in July, disregarding the July benzene contract that settled with increases of €37/ton in Europe for July. Market fundamentals were reported to be balanced and no supply concerns emerged. Even some decreases passed on a few deals with a distributor of DSM producer commenting, “We have decided to cut our July list prices by €100/ton as they were standing on the high end of the range while we noticed rollovers passing on most of July deals amid balanced market conditions.” Meanwhile, July caprolactam contracts have yet to settle at the time of the publication. Players generally do not expect any change on PA6 prices in August given the sufficient supply and the expected slowdown in demand next month.
The PA66 market, instead, did not see any supply relief and remained on a bullish note in July. Although the butadiene contracts settled €25/ton lower in July, PA66 tightness persisted and it continued to dominate the market, exerting strong pressure on prices. Accordingly, the major European producers applied a new round of sharp hikes of €200/ton up to €500/ton on their July prices. A distributor of a major West European producer commented, “We have applied massive increases of €500/ton on our July price lists, breaking the €4000/ton threshold. Our supplier’s stocks are very low and we struggled to supply our regular customers’ needs with a few of them switching to PA6 for some applications given more comfortable supply for this product.” Other European sellers, meanwhile, applied relatively smaller price increases of €200-300/ton on their July offers, confirming the persistent tightness in the market. Meanwhile, ADN output issues were still in place at BASF’s unit and players do not expect a better scenario until the middle of the next year. As for August, meanwhile, prices may hover at around the current levels given the traditionally slow activities during the long summer break.
The PC market tracked a stable trend in July after the strong increases registered in the past few months. Players concurred that overall supply has slightly improved but it is still considered tight. On the other hand, demand has slightly slowed down this month with a reseller offering Far Eastern material commenting, “The automotive sector which is the main applications for PC, has recently registered a slowdown while supply was sufficient to satisfy converters’ needs. Hence, prices did not post any significant changes in July.” Expectations for August are mostly calling for a stable trend in the face of slower activities during the long summer lull.
PBT prices have not posted any changes in July and deals were concluded with rollovers compared to June levels. Market fundamentals remained balanced amid regular demand from converters and sufficient stock levels on the sellers’ side. Therefore, players mostly expect a stable trend in August.
The POM market followed a firmer trend this month with July deals having been concluded with increases of mostly €40-50/ton for European origins. However, a few sellers decided to apply rollovers on their July prices as their quotations were already considered high. A market source reported that BASF and Celanese were still facing output issues and held low stocks. Plus, non-European material from S. Korea and Taiwan showed up with larger increases of €100/ton with a trader commenting, “Import supply is not ample and our overseas suppliers applied major hikes on their July POM prices reaching levels close to €2000/ton threshold.” As for August, the slow trading activities may put a cap on the firming trend given the long summer season and prices are expected to hover at around their current levels.
PMMA prices tracked a stable trend in July. A distributor of a West European producer commented, “Demand had increased in the first months of the year while it has recently slowed down but it is still healthy. As for supply, it has slightly improved this month; yet, it is still considered to be rather tight.” Meanwhile, locally held material from South Korea emerged close to the low end of the overall ranges this month at €3050-3100/ton. As for August, players widely expect that prices will hover at around their current levels.
The SAN market turned softer in July on the heels of the lower styrene contracts in Europe. July deals were concluded mostly with decreases of €30/ton with a distributor of a South European producer commenting, “Our supply was sufficient but we were able to keep the downward trend in check, conceding to smaller decreases of €30/ton on our July deals than the styrene drop of €50/ton, saving our margins.” Meanwhile, a competitive offer emerged in the import market with a buyer having received an offer for South Korean material at €1700/ton DDP. The outlook is stable to softer for August given the expectations for a stable to softer outcome in styrene contracts and slower activities in the summer holidays period.
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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