Steady-to-soft Europe PMMA demand reflects Q3 prices

19 July 2013 23:59  [Source: ICIS news]

LONDON (ICIS)--European polymethyl methacrylate (PMMA) third-quarter contract prices have rolled over and fallen from the previous quarter, amid steady-to-soft demand, sources said on Friday.

Contracts for standard grade material into the extruded sheet sector settled at €2.05-2.20/kg ($2.70-2.89/kg) FD (free delivered) NWE (northwest Europe).

Prices rolled over on the low end of the range and dropped by €0.10/kg on the high end.

“Price-wise, we are in a rollover with some small decreases,” a producer said. “[Feedstock] methyl methacrylate (MMA) is a bit short so it has not been possible to offer price decreases. Availability is good, and we are carefully managing our stocks.”

Another producer said: “It is about demand, and the weakness in the market. Supply is balanced to long.”

“Discussions have been difficult. It was a real challenge to maintain a rollover,” another producer said. “We foresee some raw material cost increases, so we tried to fight hard.”

One producer estimated that global PMMA demand is down by around 5-6% this year, because of macroeconomic instability, but it sees better demand in July than it had in June.

“June was not a good month. It was a poor month in many sectors because it was the end of the quarter, and we saw a reduction in orders. July demand is slightly better, but it's not showing a big rebound, and we expect to see some increase in September, although it will not be as good as it was last year.”

It added that industry stock levels are already low and said players are not likely to destock further. This means that 2013 is running more smoothly, it explained. “The fourth quarter should be better than last year. We'll close the gap, but it will still be negative.”

One consumer said: “On the sheet side, we have seen a real drop-off in demand in the last two to three months. We've had to decrease prices.”

Upstream, Europe July methyl methacrylate (MMA) contract prices have risen by €60-70/tonne from June, on the back of tighter availability and steady-to-firm demand.

Availability is limited, owing to the sales control in place at major producer Lucite International. The 200,000 tonne/year MMA supplier encountered technical problems at its Cassel site in the UK in June.

The producer is expected to be back onstream this month, with sales control to remain in place until 31 July. Market sources said buyers have been on a 50-60% allocation rate.

Third-quarter MMA contract negotiations are ongoing.

PMMA is an acrylic polymer that has high ultraviolet (UV) resistance and is available as resin or sheet. About two-thirds of consumption is in sheets produced by extrusion or casting, while the remainder is moulded into various shapes.

PMMA's primary use is in car headlamps and taillights. The second largest use is in construction (pool and sanitary ware, architectural fittings), and glazing/signage.

($1 = €0.76)

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By: Helena Strathearn
+44 208 652 3214

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