Polymer prices - Price decline for European polymers in April
Delayed purchases due to expectations of lower prices will appear in early April. Since April is a short month, converters will probably not wait with orders either, polymer manufacturers are expected to close their order books around the 8th of April. This provides an opportunity to implement a polymer price reduction that is smaller than the expected monomer price reduction.
However, the majority of converters prefer a conservative purchasing policy. Since end-user demand is uncertain and difficult to predict, they only plan to purchase as much as customer needs warrant. Even if certain products become in short supply, and even temporary shortages may arise due to the trade war.
A 25% protective tariff is expected to be imposed on polyethylene from the United States in mid-April, which could cause temporary supply problems and price increases as early as the second half of April, but certainly in May. Some importers are not buying for now until the situation is clarified, or they plan to sell their existing stocks at a higher price in April. Others will continue to import, but plan to pass on protective tariffs to their customers. But there are also traders who have switched to alternative Middle Eastern sources, but the first shipments are not expected to arrive until mid-May at the earliest. Therefore, it is very likely that the LLDPE (C4, C6) market will be characterized by tight supply and availability problems from mid-April to mid-May, possibly until the end. Some HDPE and LDPE grades may also be affected.
Uncertainty remains high around the Serbian polyethylene producer. The restart is planned for the last day of March, but it is not known whether the parent company's request to postpone the introduction of sanctions has been accepted. If not, we can expect tight LDPE and HDPE supply in April in the South Central Europe (SCE) region.
The price of NAPHTHA is still almost 7% lower than at the beginning of the month. This represents a price reduction of between €50 and €80 for olefin monomers. Polymer producers are likely to try to increase spreads for both polyolefins and PVC and retain some of the monomer price reductions.
For styrene monomer (SM), most market players expect a price drop of €40-50, but some say that it is possible that imported SM shipments will be delayed, which could mean a shortage in early April. This could keep SM prices stable, possibly with a small price increase of €10-30.
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