European standard thermoplastic prices dipped in March, ticked slightly upward in April and appear likely to increase further this month.
In March, the ethylene and propylene contract prices declined by €20/tonne and €23/tonne, respectively. Weak demand and excess supply, particularly for the polyethylene sector, saw prices slip more than target. L/LDPE prices fell €25-30/tonne, HDPE prices were down €20-25/tonne and PP prices fell €25-30/tonne.
Polystyrene prices moved in line with the €55/tonne rise in styrene monomer costs early March, but fell back during the month as demand crumbled. PVC base resin prices and rigid PVC compounds fell €5/tonne, matching the prorate reduction in ethylene costs. Flexible PVC compounds increased €10/tonne due to a further rise in plasticiser prices.
PET producers raised prices by €20/tonne, despite a reduction in the cost mix as a result of lower European production and a virtual absence of imports.
In April, polyolefin suppliers again wanted to at least pass on the €10/tonne rise in costs to preserve margins. However, a combination of continued over-supply and subdued demand restrained any such plans. L/LDPE prices shed €20/tonne, HDPE product prices remained unchanged from the previous month, while PP registered gains of €5/tonne.
Polystyrene prices plummeted €120/tonne following a €125/tonne reduction in styrene monomer costs. PVC prices nudged €5/tonne higher and PET also saw small gains on the back of rising raw material costs.
Supply variable
In the European polyethylene market bearishness continued throughout March and April due to weak demand, excess production and oversupply. In polypropylene, comfortable supply and stable demand supported a balanced market despite muted market activity. The PVC sector was also in better balance while polystyrene remained long. The situation for PET was helped by lower European production and a virtual absence of imports.
Supply-related developments during March and April are summarised below:
• Repsol's petrochemical plant at Sines, Portugal will undergo maintenance during May and June.
• BASF lifted the force majeure for its “ecoflex” and “ecovio” bioplastics on 3 April 2018, the remaining contamination from its ecoflex plant at Ludwigshafen was able to be removed.
• Total lifted the force majeure for polypropylene supply from its plant in Gonfreville, France 14 March. That same day, Total also declared force majeure for PP production at its plant in Feluy, Belgium – and this remains in effect.
• Total began maintenance work at its Gonfreville styrene monomer unit on March 4. Total said that major work would be carried out at the site for four months, with different units being covered progressively.
• In March, PET producers Lotte, UK, Plastivert, Switzerland and Equipolymers, Schkopau, Germany, shut down plants for scheduled maintenance.
• Saudi Arabia's Advanced Petrochemical Company shut its propane dehydrogenation unit and a polypropylene unit at its Jubail complex late February for scheduled maintenance.
