26 October 2012 08:48 [Source: ICB]
European flexible polyol contract prices in October were largely steady, albeit with some selective increases of €20-90/tonne ($26-117/tonne), depending on what had been implemented in September, market players said.
In September, flexible polyol prices had largely moved up by €70-80/tonne, and these prices rolled over into October. For those few that kept prices steady in September, they caught up with the increases in October.
As a result, European flexible slabstock conventional polyols remained steady in October at €1,790-1,910/tonne FD (free delivered) NWE (northwest Europe), with any increases largely incorporated within the existing range.
For flexible polyols, numbers on either side of the range were also heard, but they were not widely confirmed.
Flexible polyol demand in the downstream bedding and furniture sectors is reasonable, albeit fragile, particularly in the more mature northwest and southern European markets, because of ongoing soft macroeconomic conditions.
Eastern Europe, however, remains fairly resilient to the economic uncertainty because of the region's growth potential. However, a few buyers suggest that demand is also showing signs of slowing down.
The European flexible polyols market is largely balanced, as production constraints for one supplier in eastern Europe is being sufficiently covered by other sellers amid reasonable to slower demand. Some increases of €20-40/tonne and decreases of €50/tonne were also heard, but they were not widely confirmed.
For rigid polyols contracts, the general trend is of stability in October and the fourth quarter, as the need for margin recovery is being weighed against sufficient supply and some relief in upstream costs.
Some increases of €20-40/tonne and reductions of €50/tonne were also heard, but they were not widely confirmed. There is, however, some discrepancy between the general price trend and the absolute numbers reported.
While players largely confirmed prices in excess of €2,010/tonne FD NWE for rigid polyols, some sources, including a few sellers, said that prices of €2,120/tonne FD NWE were slightly too high.
The rigid polyol range has been changed to €2,010-2,100/tonne FD NWE, which represents a rollover at the low-end, but a downward adjustment of €20/tonne at the upper part of the range.
Rigid polyol demand into the downstream construction sector was satisfactory, but showing signs of seasonal and economic-related slowdown. The market is largely well aligned, despite the production constraints for one supplier, because of lower demand.
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