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West European PVC suppliers aim for stable prices, buyers eye discounts

  • 02/08/2016 (03:29)
August PVC prices are emerging across Europe after ethylene contracts settled down €20/ton from July. Despite lower ethylene, some suppliers are seeking to maintain their prices to protect their margins while buyers are targeting to obtain slight discounts citing limited trading activities due to the summer holidays as well as softer upstream costs.

A West European producer announced their new August PVC prices with rollovers from July. A producer source commented, “We expect trading activities to be weak this month considering the summer lull while we are anticipating an improvement for September when buyers will need to restock.”

Another West European producer also kept their PVC prices stable for August. A source from the producer noted, “We don’t want to lose our margins while we think that August will be a weak month in terms of trading activities in Italy and France as many companies will be away from the market for 3-4 weeks. We are waiting to receive feedback from buyers.”

A South European producer, however, cut their PVC prices by €10/ton for August in line with the lower ethylene settlements. A source from the producer confirmed the weak demand outlook for the most part of August while stating that they expect many converters to conclude their deals in the first week of the month.

In Italy, a compounder received initial August PVC offers from a West European producer with discounts of €10/ton from last month. The buyer stated that his end product demand was stable in July while he expects it to slow down this month due to the summer lull. Another compounder received stable PVC offers for August from a different West European supplier, commenting, “We will continue to make price inquiries this week. However, we won’t build stocks as we will be suspending our production for 2 weeks. Our end product demand has slowed down and it’s weaker with respect to the same period of last year.”

A pipe producer in France has already settled his August PVC contracts with decreases of €10/ton from last month. “Our suppliers conceded to slight discounts in line with ethylene contracts since they know that August will be a weak month. In addition, we don’t think stable prices are justified considering lower costs and muted trading activities,” he noted.

In Germany, a compounder received initial PVC offers with rollovers to decreases of €10/ton for August. The buyer reported that his end product demand was good in July and he expects it to be stable this month.
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