09 July 2010 23:59 [Source: ICIS news]
Europe July PET prices follow feedstocks and slip further
LONDON (ICIS news)--July polyethylene terephthalate (PET) prices are falling in Europe following decreases upstream, despite better weather spurring demand for bottles, sources said on Friday.
“Even if paraxylene (PX) dropped €50/tonne, the weather [is better], there are fewer imports, it’s the season and [customers have] used stocks... Sure there is a bit of pressure. At €1,100/tonne some deals are done, not by us,” a reseller explained.
Suppliers were attempting to stifle the fall in monthly contract prices, but lower spot figures were beginning to feature.
“We are trying to keep the decrease [from June to July] to €20/tonne,” a European producer said, echoing comments from another domestic producer. PET could drop by €40-50/tonne based on where feedstock developments, a third producer said.
Proposals to roll prices over from June’s €1,130-1,170/tonne FD (free delivered) Europe were dismissed as unrealistic following news of an upstream paraxylene (PX) price decrease.
PX fell by €50/tonne to €785/tonne FD NWE (northwest Europe) in July, according to data from global chemical market intelligence service ICIS pricing
Monoethylene glycol (MEG), PET’s other raw material, was also set to decrease in value from June’s €820/tonne FD NWE. Buyers and sellers were unable to come to a mutual decision as to how big the fall should be, however.
“A [PET] rollover is totally unrealistic especially with spot in the low €1,100s/tonne,” the third producer commented. Prices below this number were also heard, though they remained exceptional, sources agreed.
Customers were pushing for greater decreases even before news of a July PX agreement emerged, industry players said.
However, hot weather conditions through much of Europe were spurring improved sales of PET bottles so demand was already better than in June, sources said.
“Continental Europe will have to rehydrate...Most distilled water is sold in PET bottles,” one of the producers added.
($1 = €0.79)
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