Europe March PVC contract prices settle up by €60–70/tonnes

23 March 2012 23:59  [Source: ICIS news]

LONDON (ICIS)--European March polyvinyl chloride (PVC) contract prices have settled at an increase of €60–70/tonne FD (free delivered) from February on market tightness and higher production costs, market sources said on Friday.

In northwest Europe, contract prices have settled up by an average of €70/tonne ($92/tonne) FD NWE (northwest Europe). Although some producers are refusing rises below €80/tonne, others have only achieved €60/tonne.

In the UK, contract prices have settled at an average increase of £55/tonne (€66/tonne) FD UK from February. Some producers have increased values by £60/tonne, whereas others have only achieved £50/tonne. There is little buy-side confirmation above £55/tonne.

In the Mediterranean, most March contracts have settled up by €60–65/tonne from February, depending on the market and the source.

In Italy, despite an initial hike announcement of €80/tonne FD, values went up by an average of €65/tonne. Commentary from the supply side suggests a rise of €65–70/tonne, while end-users indicate €60–65/tonne.

In Spain, March prices increased by an average of €60/tonne FD, according to most suppliers and buyers. Higher values were heard from producers, but there was not sufficient confirmation from the buy side to substantiate this.

Increases of €75–85/tonne from February were heard in the eastern Mediterranean, and central and eastern Europe.

The current upward trend in prices, which has been supported by outage-related tightness, has for the second consecutive month helped PVC producers improve margins in relation to feedstock ethylene, which in March settled at a record-high €1,305/tonne, up by €86/tonne from February, on the back of firm upstream costs.

According to a northwest European producer which has achieved an increase of €60/tonne from February, this month’s price settlement has been sufficient to pass the full cost of ethylene and increase margins slightly.

($1 = €0.76, €1 = £0.83)

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By: Abache Abreu
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