Thermoplastic prices rise is November

Standard thermoplastic prices edged higher in November following an upward movement in feedstock costs

Converters resist ambitious L/LDPE rise

L/LDPE producers surprisingly announced rather ambitious price hikes of between €50-70/tonne last month, despite a rise of only €28/tonne in the November ethylene contract price. Buyers strongly resisted producers' attempts to push through such large increases and they were forced to reduce their price demands.

In the case of LDPE, notations for medium-sized accounts were settling at increases of between €15-20/tonne by mid-month.

For LLDPE, availability is less tight and prices struggled to gain around €5/tonne compared with closing position in the previous month. Lower volumes of imported LLDPE material to Europe from Asia also helped to support the small upward price development.

While material was generally available, the strikes in French restricted supply and lengthened delivery times following Total's decision to call force majeure on production at its French production facilities. There was also an unscheduled outage of one of Ineos's production lines in Cologne, Germany.

HDPE sellers seek margin gains

Producers reacted to the €28/tonne increase in the November ethylene contract price by announcing price hikes varying between €30-70/tonne. They expressed a determination to improve their margins to a more acceptable level following months of erosion. However, apart from a few cases where customers had been paying low prices, producers were forced to cut back on their asking prices. They eventually settled for gains of €15-20/tonne at the lower end of the scale.

Material availability has tightened somewhat as a result of the French strikes and a switchover towards LLDPE at swing plants.

Demand is showing a normal seasonal pattern. Injection moulding sales are lower as the beverage season comes to an end, while demand for blown film for consumer goods and blow moulding products are good.

PP higher

PP buyers faced an unexpected price rise in November following an €18/tonne increase in the propylene contract price after several months of falling prices. Sellers responded by announcing planned price increases of €20-30/tonne. They did not, however, manage to lift notations by the full amount being asked. November settlements ranged between €10-15/tonne.

Demand was very lively in early November with regular customers buying whatever material was available to obtain their maximum bonus for the year.

Supply, which had started to recover following the production outages earlier in the year, was further restricted by the French strikes. Total Petrochemicals was forced to call force majeure on all of the company's PP lines in France.

Margin gain for PS

PS suppliers called for price increases ranging from €60-70/tonne in November after the average styrene monomer cost settled €46/tonne over the October level.

They were soon forced to rein back on their demands as a result of strong customer resistance. Nevertheless, producers managed to increase GPPS prices by €50/tonne, which represented a small margin gain.

Supply is still fairly tight and demand is starting to ease as usual towards year end. BASF lifted the force majeure for HIPS in Antwerp late October. Total had to call force majeure on PS in France due to the French strikes. Meanwhile, Ineos Nova had to idle its production line for GPPS in Marl, Germany for ten days.

Small rise for PVC

PVC producers had initially asked for rather ambitious price increases of €50/tonne at the beginning of the month, citing a rise in ethylene costs and a need to improve profit margin to a more reasonable level.

They were, however, soon forced to reduce their target price to €30/tonne as a result of strong customer resistance. Indeed, notations were moved upward by no more than €5-10/tonne by mid-month.

Supply remains generally tight and producers' stocks are low. Availability tightened further early November due to the effects of the French strikes. Force majeures were still in place in mid-November at Arkema, Anwil and Vestolit. Both Arkema and Anwil are expected to have lifted force majeure before the end of November. SolVin, meanwhile, lifted force majeure on 9 November for deliveries from Tavaux in France.

Demand is holding up very well with particularly good order intake from the building and construction sectors.

PET surges in line with costs

The European PET sector continues in good balance with prices continuing to follow the trend in raw material prices in November.

Order activity began slowly last month as buyers waited for the outcome of the delayed monoethylene glycol (MEG) contract price settlement. MEG eventually settled at €905/tonne, an increase of €99/tonne on the October price level. Paraxylene (PX), the other important PET feedstock, also increased sharply, with prices up €123/tonne to €928/tonne. The impact of the MEG and PX increases on PET costs amounted to around €100/tonne.

PET resin producers were mostly successful in meeting the target price rise of €100/tonne that they wanted to cover the higher costs. Producers were not prepared to settle for less than the cost increase, especially as inventories are low and purified terephthalic acid (PTA) availability is tight.

Bottle-grade PET demand is reported by producers to be livelier than would normally be expected for the time of year. This may be a result of demand being diverted to local suppliers as a result of the continued low volumes of imported material available to European buyers.