Overview
Falling crude oil prices and soft demand put downward pressure on polymer prices.
The positive sentiment that took prices forward in August lapsed as the month came to an end and September got underway. In the background crude oil prices fell as concerns about global demand became more significant. This reduction in crude oil prices passed through into Naphtha, finally resulting in reductions in the September contract prices for C2 (ethylene), C3 (propylene) and SM (styrene monomer), with only Benzene recording a small increase, which may help to support the pricing on some engineering polymers.
The sentiment about prices going forward suggests that demand will remain quite weak and supply healthy and on this basis the downwards pressure on price is likely to continue is the remaining months of 2024.
Monomer Price Movement
Feedstock
Price per Tonne
Change (contract)
C2 (Ethylene)
£1,034.91
-£21.29
C3 (Propylene)
£932.70
-£38.33
SM (Styrene Monomer)
£1,373.07
-£6.81
Benzene
£787.04
£15.33
Brent Crude (monthly average)
£457.29
-£35.09
Exchange Rates
€
1.17
$
1.29
€/$
1.10
Mike Boswell
Managing Director – Plastribution Group
Oil Prices
No Data Found
Exchange Rates
No Data Found
UK Economic Data
Topic
Item
Date
Change
Trend
GDP
Real GDP (Q on Q)
Q1 2024
£570694
PMI
UK Manufacturing PMI
August
52.5%
UK Output
Manufacturing Index
Q2 2024
101.6%
Sales
New Car Registrations (Y on Y)
July YTD
1,238,855
Sales
Retail Sales (Y on Y)
July 24
118.5%
Labour
Unemployment Rate
Apr 24 – Jun 24
4.2%
Prices
CPI (Y on Y)
July
2.2%
Prices
RPI (Y on Y)
July
3.6%
Interest Rates
Bank of England Base Rate
August
5.0%
Polyolefins
Ethylene C2 dropping €25 / MT and Propylene C3 down €30 / MT, Polyolefin prices had a mixed start to September. Some continued to think that the market was tight and looked for increases, others proposed a rollover, pocketing the monomer reduction as a much-needed margin improvement. A small very number of producers, looking to restore market share, did offer monomer reductions on some grades. After the first week of wrangling, rollover was very much the order of the day except for LDPE that did see some increases in a slightly tight market.
There are a mixture of factors influencing pricing in the short term. Most likely scenario for the remainder of the year is for prices to be relatively flat with local production trimmed to meet weaker demand. What might pull prices down is lower shipping costs from the Far East leading to a more exports arriving. But in the opposite direction, Hurricanes in the USA could seriously impact production and reduce availability.
Ian Chisnall
Product Manager – Polyolefins
Polyolefins Feedstocks
£/Metric Tonne by month
No Data Found
LDPE
Supply
Demand
LDPE is somewhere between rollover and +€30 depending on the supplier and the starting point. There was some very early talk about order stops and limited availability to try and push increases through, but most buyers can secure what they need and typically at rollover.
LLDPE
Supply
Demand
C4 LLDPE has broadly seen a rollover but there were more signs of spot offers with small reductions around the monomer drop of €25 / MT. We are seeing slightly better availability from imports following months of disruption and this is putting a little bit of downward pressure on prices as demand remains flat. We could see an interruption to these imports if the USA Gulf Coast experiences severe weather disruption.
HDPE
Supply
Demand
HDPE has largely rolled over with an improvement in demand this month leading to a more balanced supply / demand situation than in August. HDPE could be subject to supply interruptions similar to LLDPE if the USA sees some extreme weather events.
PP
Supply
Demand
After some attempts at increases early in the month, PP pricing has mostly rolled over in September. There have been some interruptions to supply recently with several Force Majeures interrupting European production. Copolymer PP has been particularly affected and this has helped producers resist passing on the €30 / MT monomer reduction.
Other Polyolefins
EVA pricing has rolled over in line with most PE grades. Polyolefin Elastomers are also typically rolling over but may see some pressure in October as demand remains slightly weak.
Styrenics
Contract EU Styrene steadies, EU polymer prices follow.
Styrene Monomer has fallen by €8T, settling at €1612/T.
For September, EU GPPS, HIPS and ABS has rolled over. Deep sea materials have remained level too.
GPPS/HIPS/ABS supply chains are still running very low. Polymer producers have been running output at a minimum due to poor demand, and converters and distributors running inventory at very low levels due to financial pressures. Therefore, any adjustments in polymer prices are likely to be passed on immediately.
Andrew Waterfield
Product Supervisor – Styrenics
Styrenics Feedstocks
£/Metric Tonne by month
No Data Found
PS
Supply
Demand
August saw a €78/T increase in Styrene monomer, and PS rose in line, increase was attributed to a SM shortage at a major EU plant. HIPS and GPPS followed, but poor demand due the summer holiday season meant supply was still acceptable.
September brings a SM rollover in real terms (-€8/T), despite early predictions pointing to a significant drop. PS producers are announcing rollover too. Supply is normal and demand has slightly improved as we move out of the holiday period. Expectations of a fall in the near future may be causing converters to hold back on large orders.
ABS
Supply
Demand
Prices rose in August, (SM +€78/t, Butadiene +€25/T, ACN +€36/T) echoing PS, Supply was normal, and demand very low due to the holiday season.
September shows a rollover in real terms (SM -€8/t, butadiene roll, ACN -€7/t). Supply is acceptable, and demand is steadily increasing after the August break.
PC/ABS
Supply
Demand
As usual, PC/ABS price is following the trend of ABS.
Other Styrenics
SAN and specialities such as ASA and Q Resin continue to follow the price trend of ABS.
Engineering Polymers
Weak demand and sufficient supply remain the themes for most engineering materials. September has started quietly and it is likely that we will see further cutbacks in production. Producers are looking to do volume deals in the hope to stimulate some appetite to buy. Most supply chains are full, and producers will be looking to offload the inventory that has built up during the summer months.
The September benzene contract settled €18/mt higher than August at €924/mt, but this will have, at best a negligible impact to polymer pricing due to the poor demand.
Sharron Jarvis
Product Supervisor – Engineering Polymers
Engineering Polymer Feedstocks
£/Metric Tonne by month
No Data Found
PA6
Supply
Demand
With lower demand and high inventories, it is likely that prices may fall.
PA66
Supply
Demand
Demand remains very weak for PA66, so there are likely to be some cost reductions and cheaper prices in the market.
POM
Supply
Demand
As with most engineering materials, demand is weak, and producers are settling at rollover or a small decrease.
PC
Supply
Demand
PMMA
Supply
Demand
We are still seeing restricted supply of MMA which is keeping prices on the high side. Demand remains low however with no sign of an upturn yet, particularly in the automotive segment.
PBT
Supply
Demand
Poor demand and stock building over the summer means a downward trend is expected in September.
Other Engineering Polymers
The current situation for most other engineering materials is similar, weak demand and downward price pressure.
Sustainable Polymers
Recycled Polyolefins have mostly rolled over in September in line with virgin pricing. Whilst demand for industrial grades is still ok and we see some green shoots of growth, availability is still very good, and prices are keeping a little low in this sector as a result. The high-quality natural grades continue to see strong demand growth keeping prices significantly above virgin.
Ian Chisnall
Product Manager – Sustainability
Recycled LDPE / LLDPE
Supply
Demand
Recycled LDPE / LLDPE has mostly rolled over in September but the high-quality grades continue to see strong demand and restricted availability leading to some increases being requested.
Recycled HDPE
Supply
Demand
Recycled HDPE is typically rollover with industrial grades continuing to be under pressure. Natural grades for consumer packaging are in really strong demand still and premiums over virgin are significant.
Recycled PP
Supply
Demand
Recycled PP is rollover in September, prices still under pressure with availability still good and demand slightly weak. Whilst demand should improve relatively soon with legislation changes in key sectors on recycled content, this has yet to be felt in the market. As with other recycled grades, high quality natural commands a strong premium over virgin.
