Sustainable Plastics -March/ April 2021 - 36

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European petrochemical feedstock contract prices; January 2021 - March 2021 (€/tonne)

Ethylene
Propylene
Styrene
Benzene
Paraxylene

Dec

Jan

Feb

Mar

Change Feb/Mar

795

860

930

1005

145

735

800

885

970

170

918

1026

1050

1551

525

521

686

602

765

545

600

655

765

165

€/tonne

Source: SP

L/LDPE

L/LDPE prices soared to record highs over
the last two months due to severe supply
disruption and material shortages.
In February, L/LDPE prices jumped by
€200/tonne compared with a rise of €70/
tonne in the ethylene contract price. Last
month, LDPE prices leaped by a further
€280-350/tonne while LLDPE prices were
up by slightly less at around €250/tonne,
reflecting continued inflow of Middle East
material.
The supply situation which was already
stretched in February, deteriorated considerably in March as a result of the worsening
freight situation, the US freeze and European production outages.
With material so short and good demand,
converters struggled to source the material required. Suppliers were often unable to
even meet contractual volumes in full and
buyers were forced to secure any additional
volumes they wanted from wherever they
could at whatever price.

HDPE

PVC

HDPE prices soared beyond the ethylene
cost increase over the last two months due to
severe supply shortages and lively demand.
In February, HDPE prices increased between €125-145/tonne compared to the €70/
tonne rise in ethylene prices. Last month, C2
costs increased by a further €75/tonne yet
producers were able to push through most
of the €200-250/tonne price increases they
wanted without much resistance.
The very tight supply situation has worsened over the last two months. The US
freeze led to production outages and dwindling imports into Europe while several local
producers had production issues and called
force majeure.
Faced with such severe supply bottlenecks, converters frequently had great difficulty securing the material they needed to
meet good demand levels over the last two
months. Quite often, they were unbale to
meet contractual volumes in full.

P034_P036_SP_20210427.indd 36

Tight supply continued to drive PP prices
substantially higher with triple-digit increases recorded each month since the
start of the year. Supply bottlenecks intensified due to feedstock shortages and a
number of plant outages.
PP price increases have far exceeded
the €85/tonne rise in the propylene contract price in each of the last two months. In
February, prices leaped around €200/tonne
while last month, price increases accelerated €250-350/tonne. Prices are expected to
rise further this month.
Given such precarious market conditions
producers were able to call the tune and securing volume is more important than price
for converters. Producers were quite often
able to supply just a minimum of the agreed
volume for customers under contract.
Demand was very lively during the last
two months with particularly good order
intake form automotive and packaging
converters.

PVC prices have continued on an upward
trend over the last two months backed by
very tight supply. Supply remains very limited due to a spate of planned and unplanned
plant stoppages.
In February, PVC base prices increased
by more than the proportionate rise in C2
costs showing gains of at least €60/tonne.
Last month, PVC base resin prices increased by around €100/tonne, more than
twice as much as the proportionate impact
of ethylene costs. Some PVC producers
had initially called for a price increase of
€190-200/tonne, justified by the deepening shortages.
In March, flexible PVC compound prices
soared over €200/tonne due to a plasticiser
shortage following plant outages in Germany and France.
Demand is high, particularly from the building and cable sectors, yet not all converters
were able to secure the volumes they needed.

PS
In February, polystyrene prices increased €30/
tonne, the fourth month in a row, following a
€24/tonne rise in styrene monomer costs.
Supply had returned to more normal levels and
converters sought to buy additional volumes in
view of growing supply concerns.
The market situation changed dramatically last month with production shutdowns
and much tighter material availability. Styrene
monomer costs increased by €501/tonne as a
force majeure at the large Dutch plant in Maasvlakte caused considerable insecurity - especially as no imports were incoming from the US.
PS producers announced planned price
increases to cover the cost rise and managed gains of €500/tonne without negotiation. Further price increases are likely for the
foreseeable future.
In view of such sky-high prices, converters
held back from additional buying and either
drew down stocks or considered temporarily
shutting down their machines.

PET
The European PET market is heavily impacted by the worsening turbulence in the global
petrochemical and logistics sectors. As a result, PET feedstock availability in Europe has
shortened considerably and costs have risen.
In February, PET prices increased €100/
tonne compared to a €50/tonne increase in
feedstock costs.
Last month, the monoethylene glycol
contract price increased €120/tonne and
paraxylene settled €110/tonne higher. Since
seasonal demand picked up while feedstock
supply and imported material remained
scarce, PET prices soared €150-200/tonne.
In March, supply turned even tighter amid
planned/unplanned plant shutdowns at regional feedstock producers. Concerns over
global feedstock availability were exacerbated by recent supply disruptions in the US
Gulf amid the winter storms. Inflated freight
rates and ongoing logistical hurdles continue
to curb imports of PTA, which is short across
the board, along with PET resin supply.

March/April 2021

4/15/21 10:22 AM

Sustainable Plastics -March/ April 2021

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