Oversupply forces L/LDPE lower as costs rise
Price development for the various standard thermoplastic material classes varied in May, with modest price movements up and down, depending on feedstock contract price settlements. A spike in naphtha prices on the back of an overall rising crude oil price, sparked an increase in the ethylene and propylene contract prices for May.
For polyolefins, there were quite different price movements for L/LDPE, HDPE and PP. L/LDPE prices fell despite a €20/tonne rise in the ethylene contract price. L/LDPE prices were between €5-10/tonne lower compared with April closing levels. This was mainly as a result of continued surplus supply and subdued demand.
HDPE, where supply is tighter, registered gains of around €15/tonne, still less than the increase in feedstock costs. Polypropylene prices were also firmer with a rise of €15/tonne, which was again less than the €25/tonne rise in the propylene contract price.
Polystyrene prices fell again in May following the triple-digit decline in April. General-purpose PS product prices dropped by around €30/tonne compared with a €40/tonne reduction in the styrene monomer reference price, meaning producers slightly improved their profit margins.
PVC base resin prices saw modest price gains while flexible PVC compounds increased by a bit more due to the high plasticiser prices.
Bottle-grade PET prices saw another spurt in May as a result of production outages at a major PTA producer and strong seasonal demand.