30 November 2012 14:07 [Source: ICIS news]
LONDON (ICIS)--Dow Europe is targeting an €80/tonne ($104/tonne) increase for December polyethylene (PE) business, buyers said on Friday.
The move was seen as over ambitious by many but spot demand has increased for December, leading to an increase in prices, albeit for very limited volumes. Spot volumes are limited on low availability, however, as both producers and traders withdraw offers at former levels.
In early November, spot low density polyethylene (LDPE) prices had fallen to below €1,200/tonne FD (free delivered) NWE (northwest Europe), but this is no longer available.
“Our bottom LDPE spot price is now €1,300/tonne FD NWE,” said one seller.
“We are not selling spot at the moment,” said another, “we don’t have the availability.”
In spite of Dow’s move, other producers are being more cautious, with a couple already rolling prices over for December. Other positions lie between these extremes, but buyers intend to resist an increase for December.
“December has very few working days,” said one of the sellers.
“There is no way I am paying an increase in December,” said a buyer. “I will cancel volumes with suppliers who insist on one.”
If some buyers are convinced that prices will not move up in December, they are less sure over possible increases in January. Prices have risen in the first month of the year for the past four years, but demand is expected to be low in 2013.
One thing is certain, however, is that the downward price trend that began in September.
($1 = €0.77)
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