Weekly commodity price report

The following factors influenced “commodity” polymer prices and price expectations last week:

• BRENT oil price 67.23 USD/barrel, slightly dropping prices
• EUR/USD: 1.1316, EURO getting weaker
• NAPHTHA: 532.50 USD/t, increasing prices
• Weird demand
• Short PE and PP supply

During the first two weeks of March demand showed its weird face. Though plastic converters produce and sell like in previous years, but buy less.  Distributors reported about this.  Yet polymer producers are satisfied with the demand. For the time being converters observe market prices. There are two reasons for this: they filled up their inventories in January and February. The other reason is that during the last year a practice was established, namely converters rather postpone a part of their purchases (spot) to the second half of the month. It is not by chance that producers and traders use a much more flexible pricing, it is easier to get discounts. In many cases producers themselves reduce prices if demand is not sufficient.  We have experienced this last week in Poland as well.  Following the initial dynamic price increase following monomer prices the market corrected (reduced) prices by 5-10 Euro, to a different extent for each product.   The general opinion of market players is that the real demand in March will manifest itself during the week ahead (third week).  The question is, how high supply really is? We mentioned last week as well that due to the maintenance of HIP-Petrohemija, HIPOL, Unipetrol and the capacity enlargement of BOP the supply of feedstock from Central Europe came to be shorter.  But because of the many trading companies newly entering the market supply seems to be abundant.  It can be assumed that there are no high quantities behind the high number of offers. We will see this soon. Because of the continuous price increase of the feedstock (oil and naphtha) the price increase will probably continue through April. During the two weeks ahead we expect increasing spot demand both in case of polyolefin and polystyrene grades.

Polyolefin grades

Typical LDPE prices were in a range of  1,010-1,070 €/t last week.  In case of positions on pallets the price reached even 1,120 €. Traders complain about feedstock shortage. But for the time being converters do not feel that yet.  Demand is expected to grow during the week ahead.

Because of the aforementioned price correction in Poland prices below 1,100 € made their comeback to Poland.  Here the typical HDPE prices were in a range of 1,085-1,150 €/t. In the other parts of Central-Europe prices are typically higher than 1,100 €/t. Here the typical price is 1,120-1,170 €/t. The source of cheaper HDPE is typically import from outside of Europe. But the price of grades from Uzbekistan will be in the bottom band of the price range. In the southern part of Central-Europe also the local producer increased prices. It followed monomer prices increase, with the exception of HDPE BM grades.

HDPE BM prices were in a range of  1,090-1,150 €/t in Poland, while in a range of 1,120-1,190 €/t in other parts of Central-Europe.  Supply is balanced for the time being.  Demand is lower than expected. 

The tendency of HDPE IM prices was similar in Poland and also in the other countries of Central-Europe.  Last week we have measured prices in a range of  1,110-1,170 €/t.  The supply is short and expected to get even shorter.

In case of HDPE FILM grades, in Poland, prices were in a range of 1,090-1,160 €/t last week. In the other countries of Central-Europe we have measured typical prices in a range of 1,120-1,170 €/t.  Next week demand is expected to increase. On the level of converters there is no shortage yet, but traders slowly run short of their March inventories. The question is how they will satisfy the increasing demand.

Typical prices of HDPE (100) grades were in a range of 1,270-1,360 €/t they did not change compared to the previous week.  Demand is lower than expected. 

LLDPE C4 supply increased, but prices did not drop.  The typical price range is 1,000-1,060 €/t.  Most transactions happened in the range of 1,000-1,030 €/t.  There were offers also about quantities cheaper than 1,000 €/t, but their origin and quantity is uncertain. 

MLLDPE (C6) prices still vary in a broad range of 1,140-1,280 €/t, depending on the grade and producer.  Supply is balanced and demand is good.

PPH demand is high.  But supply is short. The typical price range was 1,140-1,260 €.  

Typical PPH Raffia prices were in a range of  1,120-1,210 €/t in Central Europe. Supply is in general short. We expect the demand to increase and a minor price increase on the spot markets.

The price of non-special PPM IM products with medium melt index was in a range of 1,140-1,220 €/t.  Last week.  The prices of products with high melt index were in a range of 1,180-1,260 €/t last week.  There is a particularly high demand for grades with high melt index.  Supply is short. In case of spot sales even price increase is possible.

Typical prices of PPC grades were in a range of 1,190-1,310 €/t in Central-Europe last week.  We have measured the cheapest prices in Poland.  The price range  1,190-1,220 €/t is grade imported from outside of Europe, typically with low and medium flow index.  For grades with high melt index demand is high, supply is short. But the demand for pipe grades is at least as good as that.

The PPR price range was 1,280-1,370 €/t, depending on the grade, producer and application area. Demand is good and getting higher. Certain IM grades are hard to have.  In this way buyers are also willing to pay higher prices.

The typical prices of the last week are presented in the table below (full truck load 20-22.5 t):

Polystyrene grades

The rate of EPS price increase did not in every case reach 40-50 € expected by us. In many cases prices increased by 20-30 € only.  In particular in case of buyers who started from a higher price in February. Prices were in a range of 1,240-1,310 €/t last week.   Demand is good and supply is broad.  Yet buyers have significant inventories and this prevents major price increase.

In case of GPPS/HIPS the price increase following monomer prices was accepted on the market. Typical GPPS prices are in a price range of 1,240-1,310 €/t.  Supply is short.  Because of the minor production obstacles of a major CE producer. HIPS prices were in a range of 1,310-1,400 €/t.  Demand is good and supply is almost limited to European grades.  Demand for both grades is good and is expected to get stronger.

ABS prices were in a range of 1,490 - 1,650 €/t last week.  Cheapest prices around  1,500 € are typically prices of grades imported from Asia, first of all from South Korea.  European products are in a price range of  1,540-1,650 €.  Demand is good, supply is broad and balanced.