29 November 2013 13:20 [Source: ICIS news]
LONDON (ICIS)--Polyethylene (PE) and polypropylene (PP) sellers in Europe are considering options for December following the settlement of the European monomer contracts at a €30/tonne increase, several said on Friday.
Both ethylene and propylene monthly contract prices settled higher. The new ethylene contract is at €1,225/tonne FD (free delivered) NWE (northwest Europe), while the propylene contract settled at €1,110/tonne FD NWE.
“This was no great surprise,” said one PP producer. “We will recover the €30/tonne [$41/tonne].”
“We haven’t decided yet what we will announce,” said a producer of both PE and PP, “but the minimum will be the €30/tonne of ethylene and propylene.”
Most buyers had also been expecting an increase, as they have seen naphtha prices rise and a balanced-to-tight market. A couple said on Friday that they expect PE and PP prices to rise by the monomer increase in December, but they also expect demand to be affected.
“These prices are very high,” said a buyer. “Nobody is going to be taking much stock at these levels.”
Prices were still not at record highs, however. In April 2011 both PE and PP were at an all-time high.
Low density polyethylene (LDPE) spot prices were above €1,500/tonne FD NWE, while PP homopolymer injection spot prices were at €1,410/tonne, both on a net basis.
This week LDPE prices were trading at €1,300/tonne FD NWE, while PP homopolymer prices were around €1,220-1,250/tonne FD NWE.
There was already some talk of more increases in January but much depended on the cost of naphtha in the coming weeks.
($1 = €0.74)
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