L/LDPE
In December, producers of L/LDPE posted planned price increases way above the €20/tonne rise in the ethylene contract price. LDPE saw gains of €85/tonne with LLDPE registering more moderate gains of €55/tonne. LDPE supply was very low due to several plant outages and strong export orders. LLDPE supply was not quite as short as LDPE. There was however less Middle Eastern imported material available.
Demand was livelier than usual for December with stockpiling in the UK and coronavirus-related stock building on the continent. Converters were also aware of large cost increases to be passed through in January.
In January, producers asked for increases of €200/tonne even though ethylene costs had only risen €65/tonne. Producers justified the margin increase on material tightness and higher prices in other world regions. L/LDPE prices had increased €140-150/tonne by mid-month.
HDPE
In December, HDPE sellers managed price increase above the €20/tonne ethylene contract price increase as a result of tightening availability and higher than usual demand. Price increases varied between different grades; blow moulding gained €45/tonne, blown film €50/tonne and injection moulding €60/tonne.
Supply from European producers was rather limited by unscheduled plant outages while imports from the US were lower than normal. Demand was much livelier than usual as converters restocked in anticipation of a large price rise at the beginning of the New Year.
In January, HDPE producers called for price hikes of €200/tonne despite only a €65/tonne rise in the ethylene contract price. Producers justified the price rise on grounds of tight availability due to plant outages, lower imports, and higher prices in other world regions. HDPE prices had increased €140-150/tonne by mid-month.
PP
In December, PP producers pushed through price hikes well above the €15/tonne rise in the propylene contract price. Homopolymer injection grades increased €45/tonne with homopolymer film and copolymer injection grades up by €50/tonne.
Supply was hampered by a number of planned and unplanned plant outages and lower imports. Demand was unusually good for December. Converters were pre-buying in expectation of higher January prices. Film grade demand benefitted from strong packaging sales as a result of coronavirus-related lockdowns being introduced across the continent.
In January, PP producers called for price hikes of up to €200/tonne, which was well in excess of the €65/tonne rise in the propylene contract price. Producers justified the hefty increase on plant outages leading to market tightness, strong demand and higher prices in other world regions. PP prices had increased €140-150/tonne by mid-January.
PVC
PVC prices continued their sharp upward trend in December with gains above the rise in ethylene costs. PVC base resin prices increased by €25/tonne, unplasticized. PVC compounds increased €20/tonne with price stability for additives. Plasticised PVC compounds increased €30/tonne reflecting higher plasticiser prices.
PVC base material remained short because of several planned and unplanned plant stoppages. Demand from building and construction was high and many converters were building stocks ahead of an expected large price rise in January.
In January, PVC prices maintained an uptrend for the eighth month in a row. Producers called for price increases of up to €100/tonne, which is well in excess of the proportionate €32.5/tonne ethylene cost rise. Producers said the price increase was due to tight availability, a need to compensate for low caustic soda prices and good demand.
PS
In December, polystyrene prices surged due to a sharp increase in feedstock costs. Many producers asked for significantly higher prices than the €139/tonne rise in the styrene monomer reference price with one supplier asking for a price increase of €250/tonne. Nevertheless, GPPS prices were up €160/tonne over the month with HIPS increasing €165/tonne.
Material availability was limited by several planned and unplanned plant outages and strong exports orders from Asia. Demand was high as many converters bought whatever additional material they could before a further expected price hike in January.
In January, PS maintained a strong upward trajectory following the €108/tonne rise in the styrene monomer reference price. By mid-month, contract prices were settling €110-120/tonne higher compared to the previous month. The tight supply situation has eased somewhat compared to December and demand was normal.
PET
December PET prices saw increases of up to €20-30/tonne with the increases mostly reflecting higher paraxylene costs (+€30/tonne), reduced availability, disrupted imports amid container issues, and an uptick in demand amid supply concerns.
European PET prices accelerated after import PET prices started being offered above the local ranges as a result of the shortage of shipping containers in Asia and surging freight costs. Local supply remained low despite some plants returning after maintenance. Beverages demand deteriorated further due to the worsening pandemic situation while hygiene sector demand remained strong.
PET markets began the year on a firm footing, supported by higher costs and lower availability due to a lack of imports from Asia. Initial January offers showed increases of €30-40/tonne. Import prices lost competitiveness due to the surging freight rates amid a lack of vessel availability.
