Europe PP spot prices down on weak demand

LONDON (ICIS)–Polypropylene (PP) spot prices are falling in May as demand remains weak, sources agreed on Monday.

Levels for homopolymer injection were approaching those of early April, falling below €1,000/tonne FD (free delivered) NWE (northwest Europe).

“Demand is awful,” said one distributor.

It is now becoming evident that strong buying earlier in the year was partly down to stockpiling, as many converters have been able to reduce volumes considerably in May.

“They [buyers] just aren’t calling,” said another distributor.

In spite of this slowdown on many homopolymer grades, there were still some pockets of tightness for some copolymer grades.

“We just haven’t been able to build up any stock,” said one copolymer buyer.

Sellers are not too dispirited about demand so far in the PP market in general, however, as most expect buying to pick up in June, as they consider that stocks cannot be too high with converters.

The June propylene contract could go up, according to some producers, but the increase will be minimal, and PP buyers generally expect producers to swallow any increase, given the improved spread between monomer and polymer that they have been able to build in recent months.

PP is used in packaging, the manufacture of household goods and also in the automotive industry.