Europe Sept flexible polyol contract prices firm on feedstock, demand

18 September 2013 23:59  [Source: ICIS news]

LONDON (ICIS)--European flexible polyol contract prices have firmed in September due to the propylene feedstock increases over the last two months and some signs of increased demand after the summer lull.

Prices firmed by €30/tonne ($40/tonne) on the low end to €1,700/tonne FD (free delivered) NWE (northwest Europe) and €40 on the high end to €1,770/tonne FD, boosted by seasonal ordering from the bedding and furniture sector which began earlier this month, according to some players.

Although the consensus is that demand has slightly improved coming out of August, views are mixed as to whether demand levels are as strong as they were expected to be given the seasonality.

A producer, having increased its prices between €40-60/tonne for September, said demand is reasonable considering the European economy was still in recovery, but it was expecting more at this stage in the month.

It quoted it prices at €1,700-1,800/tonne FD. Availability, it said, remains high despite the BASF maintenance shutdown at its polyols plant in Schwarzheide, Germany.

The same sentiment was echoed by a buyer who said product remains widely available despite the plant maintenance and quoted prices in the mid €1,700’s/tonne FD, up €40-50/tonne from its prices in August.

A second buyer said it had received a rollover in its prices, quoting a price of €1,680/tonne FD after discounts, but the published range includes pre-discounted price levels, according to ICIS methodology.

A third buyer also confirmed some rollovers but generally saw a €20/tonne increase on average. Rollovers could not be widely confirmed in the market.

A major producer said it had increased its prices for both flexible and rigid polyol grades by €60-70/tonne, although it was not forthcoming with absolute numbers.

Demand, it said, is reasonable and there are no supply issues in the market. A third producer said demand had improved from last month but added that its flexible polyol prices are €100-130/tonne lower than at the same point last year owing to poor macroeconomic conditions.

Sentiment for rigid polyols, on the other hand, was more mixed with increases quoted in a wide range of €25-100/tonne with no indications of absolute numbers in northwest Europe.

A buyer in the Mediterranean said its prices had rolled over into September, quoting around €2,100/tonne FD after discounts. The price range for rigid polyols was unchanged and remains representative of August business, pending further market feedback from other market players.

By: Stefan Naidu
+44 208 652 3214

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