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PE players discuss June outlook in Italy

by ChemOrbis Editorial Team -
  • 20/05/2015 (16:46)
In Italy, the PE market remains bullish this week and most sellers are either sold out or have limited availability left for May. Players are now focused on the June outlook. Sellers are projecting a new round of increases, albeit in smaller amounts compared to this month, assuming that tightness will not ease soon. However, buyers do not exclude the possibility of rollovers now that the majority of the force majeure declarations on PE have been lifted in Europe.

A West European producer is giving offers for their May PE contracts with hikes of €200/ton from last month. In the spot market, the producer concluded their May deals with increases of €140-160/ton after stepping back from their initial sharper hikes of €200/ton due to resistance from buyers. A producer source said, “Our LDPE supply has slightly improved, but the overall availability is still tight. Buyers are taking a waiting stance ahead of June. We think that PE prices will post further small gains next month.”

Increases between €150-200/ton are being reported in the distribution market. Regarding June, sellers are voicing firm expectations while reporting that a South European producer has shut their plant for a turnaround. A distributor commented, “We expect PE prices to gain further ground next month even if ethylene contracts settle with rollovers as supply is yet to improve.”
Spot PE prices are at €1540-1650/ton for LDPE, at €1550-1650/ton for LLDPE and at €1540-1650/ton for HDPE FD Italy, 60 days. The majority of the prices are at around €1600/ton for all three products.

A packaging producer made some purchases with increases of €150-200/ton from last month. The buyer reported hearing hike intentions of €50/ton for June PE prices due to the prevailing tightness. Another packaging producer reported buying limited volumes this month due to high prices. The buyer stated that he is planning to keep purchasing hand to mouth if PE prices gain further ground in June. A converter said, “We bought LDPE at €1520/ton earlier in the month, but such levels are no longer available. PE prices have posted sharp hikes this month and we think that rollovers are possible for June.”
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