Turkish players see more PE, PP imports from Europe

Linda Naylor

11-Aug-2014

Europe PPLONDON (ICIS)–Traders in Turkey are seeing increased volumes of European polyethylene (PE) and polypropylene (PP) offered, following a period when availability from Europe had been reduced, sources said on Monday.

“PP is struggling a bit… and Europe is active right now,” said one trader.

Offers were heard in the low-€1,200s/tonne CFR (cost and freight), but there was no confirmation of this from European producer sources. A level of €1,230/tonne CFR would equate to around $1,645-1,650/tonne.

Turkish homopolymer injection prices have been quoted in a wide range, at $1,610-1,670/tonne CFR, with the top end reflecting offers of product with a 3% import duty, and the bottom end usually a 6.5% duty. European PP is not subject to duty.

PP activity in Turkey has been slow to pick up after Ramadan and subsequent holidays, but offers have also been fairly low. Sources feared an increase in European offers could have an impact on prices.

PP availability in Europe had been restricted in May, and some grades were short. In subsequent weeks, tightness has eased, but there was little availability for export, and offers seen into Turkey in the past few days are the first seen for some time.

European PP prices have slipped by €15/tonne in August so far, following the €20/tonne drop in the August propylene contract, and buyers fully expect to be able to achieve the full monomer drop.

Homopolymer injection spot prices have slipped to below €1,300/tonne FD (free delivered) NWE (northwest Europe) in some cases, on a net basis, decreasing by around €30/tonne.

There was also increased availability of high density polyethylene (HDPE) from Europe, according to traders, in the mid-to-high €1,200s/tonne CFR. It was not clear which grades, or how much, was available.

HDPE in Europe had been less tight than PP, and imported HDPE has more impact in Europe than imported PP. There had been pockets of tightness for some HDPE grades, particularly in the film sector, and more recently in the speciality blowmoulding market.

HDPE net prices remain in the mid-to-high €1,200s/tonne FD NWE. August monthly contracts are widely expected to drop in line with the €15/tonne drop in the August ethylene contract.

PP and PE are used widely in the manufacture of household goods and packaging. PE is also used in the agricultural industry, and PP in the automotive sector.

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