Weekly commodity price report

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

• BRENT oil price 61.67 USD/barrel, increasing  prices compared to last week,
• EUR/USD: 1.1411, Euro getting stronger
• NAPHTHA: 479,00 USD/t, decreasing prices
• low PE and high PPH and PS demand during the last week of November
• dropping contracted monomer prices
• Ethylene (C2) contractual price in December: 1,025 EUR/t, -110 €/t drop
• Ethylene (C3) contractual price in December: 960 EUR/t, -100 €/t drop,
• Styrene monomer (SM) contracted price 990 EUR/t, -150 €/t drop,

The price of polyolefin grades dropped. Producer prices dropped by 50-80 €, depending on the grade and application area. The price reduction was not proportional. The prices in the lower end of the price range dropped by 20-30 € and those in the higher end by 60-80 €.  LDPE had the smallest space for price change, here the bottom line of the price range dropped by some 20 €, while top prices dropped by even as much as 50. Decreasing prices did not boost demand significantly. Only PPH demand is high. The mood of the market is basically characterized by December.  The week ahead can be regarded as a week of full value in terms of demand, and most market players will slowly come to a halt. The market is expected to restart as of January 7.  Because of this and due to the price reduction expectations just a few plan to purchase higher quantities at the end of the year.  In this way it is possible that in December producers will decrease prices slightly.  The real question is how prices will change in January. The present expectations imply price reduction, but oil prices came to a turn this week, and this will probably also be followed by NAPHTHA. 

In case of SM we did not expect major changes in December, in spite of this prices decreased dramatically, last time there were prices below 1,000 €/t three years ago. SM volatility is high, in this way prices will shortly start increasing.  PS demand was high last month as well and increased further as a result of the price reduction.  But European producers surprisingly sold everything within one week. Materials are no longer available, producers accept no more orders for December. From the SM price reduction (320 Euro) of the last 2 months polymer producers passed on an average 200-230 € to converters. Traders are searching for import sources from outside of Europe, they buy significant quantities on the present price level.  This might curb the probably steep price increase in January-February.

In detail

Polyolefin grades

Typical LDPE prices were in a range of 1,020-1,120 €/t last week.  This means a price drop by about 10-50 €.  Polymer producers who kept their prices high so far were forced to make a major price sacrifice. The demand is slightly lower than moderate, in line with the season. But after December 15 a major fallback is to be expected in trade. This might result in a further price drop affecting first of all the top of the price range. 

HDPE prices dropped by 50-70 €, depending on the grade and application area.  In Central Europe the typical prices were in a range of 1,100-1,210 €/t last week. HDPE IM prices in a range of 1,010-1,180 €/t were lowest, in case of some major buyers prices were even below 1,100 €. HDPE Film and BM prices are in a range of 1,120-1,210 €. The demand is in line with the season.  There are no major end-of-the-year purchases. Smaller, first of all “campaign” price reductions are still possible, but we expect no major price drop in December.

The HDPE (100) season has ended, demand is low. The monomer price reduction was followed by a polymer price drop by 70-80 Euro, the typical price range is 1,270-1,340 €/t in December. 

LLDPE C4 prices have dropped slightly, there was a price reduction by only 10-20 € in total.  The typical price range was 1,050 - 1,140 €/t.  Buyers would love LLDPE to follow the general price tendency. Yet the monomer price drop in Europe does not really affect LLDPE prices.  Demand is still good. In December we anticipate no significant further price change.

mLLDPE prices were in a range of 1,220-1,380 €/t last week.  There was only a minor price change by 20-30 €. Demand is still good at the present.

PPH prices dropped by 20-80 Euro last week, they were in a range of 1,150-1,280 €/t.  CE PPH raffia prices were in a range of 1,150-1,210 €/t.   The price of non-special PPM IM products with medium melt index came to be more narrow, the price range was 1,170-1,230 €/t. The prices of products with high melt index were in a range of 1,220-1,280 €/t last week.  Demand is high, which is first of all due to the short supply.  We anticipate stable prices in December.  There is no sign of further price drop in sight.

Typical prices of PPC grades were in a range of 1,250-1,340 €/t in Central-Europe last week.  This practically in accordance with the price level at the end of November. Demand is low and will probably drop further as of the middle of December. Minor “price reduction campaign” by the polymer producers can be expected during the last third of December.

The PPR price range was 1,280-1,400 €/t, depending on the grade, producer and application area last week.  There was a price drop by about 40-80 €.  The demand, that for pipe grades in particular is low and is getting lower.

The prices to be expected during the first week of December are presented in the table below (full truck load 20-22.5 t):

Polystyrene grades

The end of the season and dropping demand resulted in major price reduction also in December, prices dropped by 120-140 €.  Polymer producers, anticipating low demand in January try selling everything now. Last week in Central Europe EPS prices were in a range of 1,260-1,370 €/t.  

The demand for GPPS and HIPS is still very high.  But producers, by referring to lacking inventories, do not accept further orders. Prices dropped further. The typical GPPS price range was 1,200-1,260 €.  HIPS prices were in a range of 1,210-1,290 €. “Order stop” continues in Europe. “Free trade” was practically possible for one week. Plastic converters and PS distributors outside of Europe try purchasing still in December at low prices.

We will publish the last price report this year on December 17.  The first price report of 2019 will be published on January 7.