11 September 2008 13:49 [Source: ICIS news]
LONDON (ICS news)--Europe polyethylene (PE) prices are on their way down, with buyers looking for reductions of €50-100/tonne for September business as oil shifts below $100/bbl and demand falters, market sources said on Thursday.
Most September PE business was still under discussion, but buyers were pushing for big reductions in spite of producers' remonstrations that they were still working with high third-quarter ethylene monomer prices.
“We are pushing for a drop of €50/tonne ($70/tonne) in September, but we haven’t settled anything yet,” said one buyer.
Added another: “We haven’t settled yet but we are looking for a decrease of €60-100/tonne for our linear (low density polyethylene) this month.
“They have been pushing increases on us for months, now it’s our turn."
Low density PE (LDPE) monthly prices rose by almost €300/tonne between January and August to their high of €1,570/tonne FD (free delivered) NWE (northwest ?xml:namespace>
Several producers admitted that they were concerned that some of their converters would find it hard to survive under the harsh economic conditions that were now hitting European economies.
They generally accepted that they would have to reduce prices in September but argued that anything more than €30-40/tonne down was not feasible.
“It’s true that the market is a lazy market,” said one major PE producer. “But we are still working with the Q3 ethylene price.”
Discussions were expected to continue over the next week, with both buyers and sellers aware that prices would retreat further in October.
PE suppliers in
($1 = €0.71)
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