POM drops; PMMA unchanged

Acetal (POM) prices have weakened considerably over the past three months and the outlook is for further declines. PMMA supply, meanwhile, has remained better balanced but even here producers are likely to face price pressure.

POM prices fall across the range, more cuts likely

The European POM market has seen major price reductions over the last three months as demand has weakened, supply has strengthened and feedstock costs fallen.

Since last November, natural grade polyacetal resin prices have fallen by around €270/tonne at the lower end of the scale, with smaller price decreases at the top end of the range.

A large proportion of this price decline occurred in January in response to the €159/tonne reduction in the Q1 methanol feedstock contract price. POM sales have also plummeted further since November, due to falling demand from the major end use sectors of automotive and construction. The market is also currently very well supplied both from local producers and with a growing volume of imported Asian material.

Given the current market situation it appears likely there will be further downward price movement over the next three months.

Balance in PMMA markets holds off price cuts

Unlike many of the major engineering thermoplastics markets, the PMMA market remains well balanced at present with limited evidence of over-supply. As a consequence, acrylics prices have remained largely stable over the past three months – a distinct contrast with other ETP markets.

However, given the deteriorating demand trend evident during Q4, sellers were forced to shelve plans to raise PMMA prices, which they claim were necessary to cover the €110/tonne increase in the Q4 MMA contract price.

Since last November, European PMMA demand has dropped considerably due to weakness in key end use sectors such as automotive and consumer goods. Material availability is good, despite producers limiting production and reducing inventories in response to falling sales.

There are also limited volumes of imported material entering Europe. In Q1, the MMA contract price fell by €250/tonne against Q4. With slack sales and no supply shortages, PMMA producers may be forced to pass on at least some of the cost reductions to converters.