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October expectations shaping up in the European PVC market

  • 20/09/2016 (04:51)
The European PVC market is tracking a mainly stable trend this week and expectations are shaping up for October. Some players are skeptical about the possibility of a firming trend looking at the demand situation and the upstream markets. Spot ethylene prices have declined by around €20/ton since the beginning of the month. However, spot naphtha prices are standing above early September levels despite volatile crude prices.

A distributor based in Switzerland concluded some deals for West and Central European PVC with rollovers from last month. The seller commented, “The market is calm and buyers are purchasing on a needs only basis. For October, we are anticipating a mainly stable trend, assuming that feedstock costs aren’t hinting at any major changes.”

In Italy, a distributor sold West European PVC at stable levels for September and stated that demand is sluggish due to the slow end product business. Regarding the October outlook, the seller is projecting a mostly steady trend with possible decreases, commenting that the PVC market might not support any increases.

A pipe producer reported receiving stable September offers for European material, but elected to buy Mexican PVC from the import market. He stated that demand is calm and he expects to see a stable trend in October as well. A compounder made some purchases from his regular European suppliers with rollovers for September. “Our end product demand is stagnant so we are cautious with our purchases. For October, we think that PVC prices will remain mostly stable as suppliers won’t be able to issue any increases considering thin buying interest,” he noted.

A packaging producer in Germany reported that he is still negotiating with his suppliers for his September PVC contracts and he expects to close his deals with rollovers from last month. For October, the buyer expects to see a downward trend, commenting that demand isn’t strong in the pipe sector and the market isn’t supporting any increases.

A pipe and profile producer in the Netherlands obtained slight discounts of €10/ton for his spot purchases. The buyer received flat offers for September PVC contracts, but he is negotiating to achieve slight reductions from the contract market as well. The buyer reported, “Demand is good in the Benelux, Germany and France. For October, one of our suppliers told us that ethylene costs will increase, but we think that the outlook is rather soft.”
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