Downward pressure on Europe PE in July and longer term

LONDON (ICIS)–Polyethylene prices in Europe could be under downward pressure in July despite a possible slight increase in naphtha costs, according to the May ICIS Polyethylene Europe Price Forecast Report.

The forecast expects ethylene supply to grow at the regional and global level as regular cracker maintenance shutdowns come to an end.

“Better supply and growing import volumes could prompt a downturn in PE [polyethylene] prices in July,” the report suggests.

“Some recovery is possible in August, depending on higher ethylene [prices] and in anticipation of the seasonal PE demand peak in September, just after the lull in the summer holidays.”

The report forecasts that lower prices might be expected longer term with the crude price remaining weak.

PE production is growing globally and is likely to do so at a stronger pace than demand over the next two years, it adds.

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