Europe May PVC contracts fall €40/tonne after ethylene decrease

24 May 2013 23:59  [Source: ICIS news]

LONDON (ICIS)--European polyvinyl chloride (PVC) contract prices for May have fallen by an average of €40/tonne ($52/tonne) from April, players said on Friday.

Contract prices in the UK have fallen by an average of £35/tonne (€41/tonne). The falls followed a €100/tonne decrease in the feedstock ethylene contract price for May.

Prices are now at €915-965/tonne FD (free delivered) NWE (northwest Europe), €850-950/tonne FD Med (Mediterranean), and £805-855/tonne FD UK.

Sellers targeted further margin improvement in May, and decreases as low as €20/tonne were heard in a few cases.

Buyers said producers had already achieved margin improvement in 2013, and they had resisted giving much more. Ethylene pass-through decreases of €50/tonne were heard in a few cases.

One producer said it had insisted on decreases no higher than €30/tonne. A buyer said it had achieved decreases of €40-45/tonne as producers had taken the volumes they needed to move into account, not just price, when negotiating contracts.

Demand was said to have improved from April. A second producer said that improved demand might allow sellers to achieve greater margin improvement in June if the monthly ethylene contract did not move by much. 

($1 = €0.77, €1 = £0.86)

By: Glynn Garlick

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