Commodity Markets: Facts and Trends

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Styrene could see rising prices in fall, since factory overhauls could lead to production bottlenecks. Paraxylol is expected to profit from a rising demand for PET plastics in the long run.

PA 6 is the only polymer that saw price increases between June and August 2011. Rising prices for HDPE, PS and PET towards the last quarter of 2011 are nevertheless regarded as probale by the IKB.

PET producers profit from arising demand from China’s fibres and textile industry. Other plastics, like PP, PVC and PA6, could see slightly falling prices due to the lower prices for basic materials.

Die-cast quality polyethylene (HDPE) prices gave in by four percent during this year’s third quarter, profiting from a lower price for ethylene. Other, more common, polymers saw even more distinct price reductions.

Die–cast polymers supply currently have a hard time meeting the global demand. This winter will see maintenance works on two major HDPE plants, so that IKB expects gentle price advances by the end of the year.

The most significant price decrease was seen for polypropylene (homopolymer, die-cast quality): prices dropped by seven percent during the quarter. The sharp decline in propylene prices and the low demands during the holiday season contributed to this decline. Production cuts and stronger exports to Asia help to reduce the polypropylene supply to normal conditions. Sinking prices for basic materials and cheap term contract deals for September will, according to the analysts, most likely result in price reductions by around € 50 per ton.

Polymer Prices: Brief Facts

Die-cast quality polyethylene (HDPE) price gives in by four percent

Factory overhauls in winter 2011 could result in rising polymer prices

Polypropylene price minus seven percent

Feedstock prices go up: Benzene plus eleven percent

Styrene price rising, PVC gives in

PET: moderate rises expected

Although prices for polystyrene significantly increased, the recent price is below the the value for June. Since benzene increased by eleven percent, styrene prices went up by around six. IKB still expects the situation to relax due to low binding contracts for benzene and styrene for September. On the short hand, spot markets are expected to follow this development. Maintenance at major plants during the winter month could, nevertheless, lead to rising prices towards the end of 2011.

Polymers Prices Give In

As with other polymers, polyvinylchloride (PVC) gave in by 5 percent compared to June – one reason being a surprisingly low demand. But also vinylchloride, an essential feedstock for PVC producers saw falling prices recently. Especially pipes and hoses performed poorly, while no effect was witnessed for cables, wire coatings and foils- Since the high supply with PVC products resulted in full stockpiles, a price increase is not very likely.

Polyethylene prices, despite a small rise in August, fell by about one percent. Since basic materials for the PET production are recently becoming more expensive, further falling prices are not very likely. A driving force of this development is China's textiles and fibres industry, that consumes large amounts of polymer fibres. IKB expects prices for PET to rise by moderate three percent.

Prices for PA 6 remained stable, although basic feedstock slightly increased. Caprolactam rose by about to percent, while benzen prices even went up by eleven percent. Since some of these developments were driven by production bottlenecks, IKB analysts that PA 6 prices could give in slightly (by around one percent) towards the end of the year.

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