OUTLOOK '13: Europe plasticizers expected to remain steady

02 January 2013 10:39  [Source: ICIS news]

By Glynn Garlick

LONDON (ICIS)--The European plasticizers market is expected to remain stable in 2013 amid an uncertain economic outlook and lacklustre downstream construction sector.

However, the sector is also seeing a battle between competing products, caused by pricing and by European environmental restrictions.

“I think 2013 will be more of the same. We expect dioctyl terephthalate [DOTP] to continue to grow aggressively and prices to remain below diisononyl phthalate [DINP],” said a producer.

There has been a gradual shift of demand to EU Reach-friendly high-phthalate compounds such as DINP, and away from low phthalates such as dioctyl phthalate (DOP).

At the same time, there has been a battle for market share in the growing DOTP market.

“We expect for the next one to two years a battle for market share between all the DOTP players,” added the producer.

“We think that DOTP will grow to more than 160,000 tonnes by 2014 at the latest. This is quadrupling the current volume. In the long run, we expect DOTP and DINP to have the same price.”

A buyer said that Europe was currently doing quite well and demand was still reasonable. It added that prospects for 2013 were more uncertain but that it saw things as remaining on the same level.

Because of the competition, DOTP prices are currently lower than those of DINP, and at times have been at around the same levels as DOP. However, one DOTP seller has said that it generally saw its prices as above those of DOP and slightly below DINP.

Low phthalates have been registered under Reach – the registration, evaluation and regulation of chemicals – the EU chemical regulation programme.

However, they are included in the EU Candidate List based on their hazard classification. This means that they will have to go through an authorisation process.

These plasticizers will be phased out by the EU by February 2015 unless an application for authorisation is made before July 2013 and an authorisation is granted.

“We also expect other plasticizers to grow in areas where traditional phthalates are under pressure,” said the producer.

“You have to think about TOTM [trioctyl trimellitate] replacing DOP in medical applications because TOTM has excellent migration resistance. Also, we expect bio-based plasticizers to draw much attention but to grow only slowly, but they will grow.”

TOTM prices are much higher than those of DOP, at close to €2,000/tonne ($2,632/tonne) in December compared with €1,550-1,600/tonne FD (free delivered) NWE (northwest Europe) for DOP.

At the same time, DOTP was at €1,590-1,640/tonne and DINP was at €1,650-1,700/tonne. 

In December, the feedstock propylene contract price for the month fell by €17/tonne. Some had been expecting a larger feedstock propylene decrease, and were still hoping for this outcome in January.

However, some producers expected the opposite of this to occur, saying that propylene costs are likely to increase in January.

($1 = €0.76)

By: Glynn Garlick

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