16 May 2014 11:34 [Source: ICIS news]
LONDON (ICIS)--Polypropylene (PP) availability is beginning to ease in Europe, following a period of tightness that sent some large buyers seeking volumes in the spot market, sources said on Friday.
Prices remain firm, however, and spot levels are reaching highs not seen since September 2013.
“The lowest price I am hearing for commodity homopolymer injection is €1,280/tonne [ FD (free delivered) NWE (northwest Europe)], but we can get as much as €1,300-1,310/tonne,” said a seller.
PP availability has been affected by propylene supply issues for some time, and while product availability is still tight, propylene is also easing, with new spot deals now being done slightly below the contract level of €1,160/tonne FD NWE, rather than above it.
“I have been called by several traders today with European product to sell,” said a buyer on Wednesday.
Product on offer was not always prime, however, and off-spec copolymer has been offered at levels close to net April pricing. Prime was said to be available at €1,330-1,350/tonne FD NWE for spot buyers this week.
Prices had slipped to as low as €1,230/tonne in October 2013 but have risen steadily since.
Fundamental demand in the PP market was not seen as particularly high, and most sources agreed that prices were firm on reduced output rather than strong demand.
Monthly prices are also moving up but levels are disputed as producers approach the market with varying degrees of increases. Hikes of €10-40/tonne are talked for monthly business.
PP is used widely in the packaging, hygiene and household goods industries, and also in the automotive sector.
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