07 March 2013 22:10 [Source: ICIS news]
HOUSTON (ICIS)--US February contract negotiations for polyethylene (PE) ended with a split settlement, with most film grades settling flat, while high density polyethylene (HDPE) injection and blow moulding grades saw an increase, sources said on Thursday.
The market began the month with producers pushing for a 4 cent/lb ($88/tonne, €68/tonne) increase for all grades for February. However, by mid month, two producers - NOVA Chemicals and Formosa Plastics - had agreed to settle the month at a rollover.
Buyers said producers had agreed to meet the competitive offer of a rollover for low density polyethylene (LDPE), linear low density polyethylene (LLDPE) and in many cases, high molecular weight HDPE.
But because NOVA and Formosa are not among the larger producers in HDPE, other producers refused to agree to a rollover for those grades, sources said. Most customers saw an increase of 4 cents/lb for HDPE blow moulding and injection grade material, sources said.
The increases were based on relatively high spot ethylene prices, which remain above 60 cents/lb, as well as low producer inventory levels.
Market participants are speculating that March contract pricing will see an increase of 4 cents/lb for LLDPE, LDPE and high molecular weight HDPE grades.
Many producers have already announced an additional price increase of 4 cents/lb for 1 April, based on planned turnarounds in the upstream ethylene market.
Following the February settlement, prices for LLDPE butene film were at 70-73 cents/lb DEL (delivered), LDPE film prices were at 79-82 cents/lb DEL and HDPE blow moulding prices were at 72-74 cents/lb DEL, for small volume buyers, as assessed by ICIS.
Major US PE producers include Chevron Phillips Chemical, LyondellBasell, Dow Chemical, ExxonMobil, Westlake, INEOS, Total, Nova Chemicals and Formosa Plastics.
($1 = €0.77)
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