Europe C4 LLDPE spot at 10-month high

LONDON (ICIS)–Linear low density polyethylene (LLDPE) C4 (butene based) spot prices have reached a high not seen since June 2018.

Farmers cover seedlings with plastic film in Tangshan, China (Source: Xinhua/REX/Shutterstock)

Fewer-than-expected imports are thought to be responsible for the rise.

Most C4 LLDPE used in Europe is imported, and very low prices earlier in 2019 meant that netbacks were better in other regions.

Prices fell between end-November 2018 and February 2019, with some spot levels talked even below €950/tonne delivered, below the prevailing ethylene contract price.

Even with the price hike, low-end C4 LLDPE spot numbers are still below the headline ethylene contract level for May, but the gap is not as wide as it was.

Monthly contracted levels are also up by more than the €30/tonne increase in the ethylene contract.

Cast grades are now tight and command a premium over blown grades, reversing the situation of some months ago.

As most C4 LLDPE into Europe is imported, much of it is based on ethane-produced ethylene.

New capacities in the US are expected to keep pressure on this PE grade in the mid-to-long term.

LLDPE is used in packaging and agriculture.