European PE buyers consent to increases beyond ethylene
A West European producer announced official contract offers with hikes of €60-70/ton for HDPE and LDPE while applying €80/ton increases on LLDPE as supply is tight, both beyond ethylene contract hikes. A producer source added, “We expect the outlook to remain bullish until April.”
A pick-up in demand was also seen due to the bullish expectations for the medium term on the back of several maintenance shutdowns as well as approaching high season.
A distributor reported, “We expect supply reductions in the next weeks and the firm trend is unlikely to lose steam until April. Plus, approaching high season for many PE applications is expected to give an upper hand to the sellers to seek increases.”
A few PE converters started to purchase their volumes ahead of the persistent bullish trend, particularly due to the reported shortages in the market. A buyer reported, “We purchased extra LLDPE from the Middle East €50/ton higher given the upward trend and the talks of reducing supply in the next weeks.”
According to many distributors in the region, PE supply is short for LDPE and LLDPE in particular due to the production outages. Plus, Middle Eastern producers are directing their export volumes to the Asian markets to get better netbacks and this has also contributed to higher prices on certain grades.
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