Summary of mid-year Europe OUTLOOK stories
ICIS Editorial
04-Aug-2022
LONDON (ICIS)–Here are the second half (H2) 2022 European OUTLOOK stories which ran on ICIS news throughout July and the first week of August.
Tight
supply concerns flip to reduced oil demand by
Q4
Oil prices were in a post-Covid recovery phase
prior to Russia’s invasion of Ukraine in
February.
Europe ethylene,
propylene players face remainder of year with
trepidation
Attempting to predict the outlook for Europe’s
ethylene and propylene markets in any given
year is tricky at the best of times, but what
about now?
Europe MX supply and
demand to face obstacles in H2
European mixed xylene (MX) supply and demand
are expected to encounter a number of hurdles
in H2 2022, and this is likely to limit any
future market progress.
Europe toluene H2 supply
to be adequate, demand faces hurdles
European toluene availability in H2 2022 is
expected to be sufficient while consumption
faces some limitations.
Europe methanol supply to
rise in H2, demand stable to soft
European methanol market conditions are
expected to lengthen in H2 2022 while demand is
stable to soft depending on the application.
European PE/PP players
wait and hope for rebound from
September
Rollercoasters are overused as a metaphor for
anything you can plot on a graph against time,
or even any experience that elicits a variety
of emotions.
Europe PET caught between
high costs and cheap imports
Polyethylene terephthalate (PET) in Europe has
an intricate dance to perform heading towards
2023 contract talks, as sellers consider high
energy costs while buyers are lured by imports.
European R-PET faces
uncertainty, feedstock challenges
The European recycled polyethylene
terephthalate (R-PET) market stabilised in July
as some monthly prices rolled over for the
first time since October, but several factors
including taxes, regulation, availability and
macroeconomic issues make the outlook for the
rest of the year increasingly uncertain.
European base oils demand
weakens for Q3, production curtailment likely
to continue
The European Group I base oils market has
paused in early H2 (second half) 2022 as a
seasonal demand lull sets in. Activity is
expected to resume in September with players
eager to see how the supply/demand landscape
will develop.
Turkey PE/PP markets
uncertain amid economic woes
Ongoing economic concerns across Turkey have
thrown the polyethylene (PE) and polypropylene
(PP) outlook into uncertainty amid crashing
demand.
European MEG market
remains gloomy on poor demand, spot under
pressure
Conditions in the European monoethylene glycol
(MEG) market have been weak for most of 2022
and the situation is unlikely to change this
month, at the very earliest.
Europe SBR demand
expectations lower, production cost
concerns
European styrene butadiene rubber (SBR) demand
could slow in 2H 2022, but worries over gas
supply resurged this month, weighing on
expectations about production costs.
Europe PA and MA caught
between imports and high energy
prices
Players in the European phthalic anhydride (PA)
and maleic anhydride (MA) markets say the
outlook for demand is bleak as pressure on
production costs is unlikely to subside.
Europe PS, EPS demand may
improve in September, October but softer
overall in H2
Softer demand trends are expected across the
second half of 2022 in both the European
polystyrene (PS) and expandable polystyrene
(EPS) markets, although there could be
temporary improvement in September and October
compared to July and August.
Uncertain half-year ahead for Europe’s glycol
ethers market
Players in Europe’s glycol ethers markets face
an uncertain outlook for the second-half of the
year.
Europe biodiesel market
set to grapple with supply chain issues in
H2
The European biodiesel market is expected to
face diverging demand trends colliding with
supply chain issues for various grades through
the remainder of 2022.
Europe ethanol faces
diverging supply, demand trends for
H2
Europe’s ethanol market is set for a turbulent
second half as different ethanol grade segments
are expected to grapple with diverging supply
and demand trends for the remainder of the
year.
Europe ABS, SAN supply
expected to stay balanced to long in
H2
Supply in Europe’s
acrylonitrile-butadiene-styrene (ABS) and
styrene-acrylonitrile (SAN) markets are
expected to be balanced to long across the
second half of 2022 because of softer demand
trends and an uncertain outlook.
Europe glycerine
anticipates supply stability in H2
Europe’s glycerine market will be increasingly
reliant on imports from southeast Asia and
south America to maintain stability of
supply through H2.
Europe ADA, nylon 6,6 to
face slow demand, ample supply in H2
The European adipic acid (ADA) and downstream
nylon 6,6 markets are set for challenging
trading conditions in the second half of 2022.
Europe H2 AA and acrylate
esters murky amid gas supply
uncertainty
The European acrylic acid (AA) and acrylate
ester markets face a challenging 2H 2022 with
uncertainty surrounding gas supply and prices
adding to the difficulties.
Europe ACN to face ample
supply, weak demand and high costs in second
half
The outlook for European acrylonitrile (ACN) is
rather gloomy and sources are getting ready for
the second act, which is set to deliver yet
more challenges to players.
Europe capro, nylon 6
struggles to continue in H2 2022
The European caprolactam (capro) and nylon 6
supply chain is entering second half of 2022
battered by soaring input costs, seriously
eroded producer margins and concerns over
downstream affordability as both buyers and
producers struggle to pass on rising costs in
product pricing.
European fatty
acids/alcohols demand weakens for H2
After a firm H1 2022, European fatty acids and
alcohols demand has weakened for H2 following
increased availability both domestically and
from Asian imports.
Europe soda ash market
considers quarterly prices as yearly contracts
see further correction
Northwest Europe (NWE) and Black Sea contract
prices rose 3% and 5.4% from Q2 contract prices
this week, marking a third adjustment to annual
agreements settled in Q4 last year, as the
market reconsiders the pace at which to
negotiate prices going forward in the face of
heightened volatility in upstream markets.
Europe MDI, TDI demand
conditions not so rosy in H2 2022
European toluene diisocyanate (TDI) and crude
and pure methylene diphenyl diisocyanate (MDI)
is headed on a downward trajectory in H2.
Europe polyols supply to
outstrip demand in H2
European flexible slabstock polyol availability
is expected to be ample in H2 2002, as demand
is on a downward trajectory.
Africa PE, PP demand
could suffer from cost-of-living
crisis
A cost-of-living crisis plays out very
differently in weaker economies than in
stronger ones.
Europe plasticizers
market faces unsettled H2 2022
Each key plasticizer in the European spot
market has slightly differing dynamics at
present, but the general H2 outlook will be
shaped by low visibility, high production costs
and inflationary pressures.
Europe oxo-alcohols spot
market faces uncertain H2 2022
Uncertainty looms over the European
oxo-alcohols spot market as security of natural
gas supply, tensions with Russia and
inflationary pressures are clouding the outlook
for H2.
Headwinds to weigh on
Europe BPA in H2 2022
Declining derivative demand and cheaper Asian
imports could weigh on the European bisphenol A
(BPA) market in 2H 2022.
European melamine demand
expectations reduced; suppliers face high
production costs
European melamine quarterly contract
discussions are taking place in a very tough
market environment. Suppliers struggle to meet
consumer expectations due to production cost
constraints that contradict the weak demand
expectations and supply length caused by import
pressure.
Further weakness
anticipated in the European propylene glycol
ethers market
With certain availability constraints set to
ease into Q3 and few expecting any demand
improvements before the autumn at the earliest,
market participants widely expect further
pressure on propylene glycol ethers through the
summer, with significant uncertainty into
September, linked to the health of the wider
economy and key end uses.
Headwinds could change
course of Europe TiO2 in H2 2022
The downturn in European demand, a slow and
export-hungry China market and conflicting
price tendencies in Europe and Asia could lead
to a change of course in the European titanium
dioxide (TiO2) market in the second half of the
year, after a prolonged upcycle.
Soft
demand, upstream cost uncertainties to define
Europe PC in H2 2022
The European polycarbonate (PC) market faces a
second half of the year in which demand levels
are expected to be subdued and production costs
will likely remain a source of uncertainty and
increased volatility.
European MMA demand
uncertain amid wider economic
challenges
The European methyl methacrylate (MMA) market
is facing uncertain H2 demand amid wider
geopolitical and economic challenges.
European POM supply
issues to persist, PBT availability to be in
balance with imports
Supply for polyacetal (POM) and polybutylene
terephthalate (PBT) in Europe is predicted to
diverge, but both markets are expected to face
issues with consumption in the second half of
the year.
Phenol and acetone at
mercy of upstream, hoping for demand
resurrection
Feedstock and gas costs will be major
influencers in the European phenol and acetone
markets in H2 2022. Their impact on demand is
the big question hanging over the market.
High
production costs, soft demand and strong
uncertainty to define Europe MPG spot
market
The European monopropylene glycol (MPG) spot
market has been defined by healthy supply and
limited buying interest for an extended period
and sources are unsure if the demand picture
will shift in H2, and, if so, to what extent.
Inflation and volatility
to stress European refinery solvents in H2
2022
European refinery solvents markets will be at
the whim of upstream feedstock and energy
prices in the second half of 2022.
Europe BDO market to
remain in balance on subdued demand
Persistent signs of demand weakness look set to
hit the European butanediol (BDO) market in the
second half of this year, although supply is
likely to remain balanced despite production
problems.
Europe ECH supply could
relax in the second half of the year
Europe epichlorohydrin (ECH) supply could relax
over the coming months, amid some derivative
summer turnarounds, the prospect of more Asian
imports and some debottlenecked capacity in
Europe.
Europe ethanolamines
braces for output cutbacks amid cost issues,
demand uncertainty
Amid rising natural gas costs, certain European
ethanolamines producers face the prospect of
curtailing homologue production.
Europe epoxy challenges
mount, some downstream support needed
The clash between opposing cost and market
factors in the European epoxy sector is
intensifying in July, as production costs soar,
while demand is waning for various reasons.
Europe LPG trajectory
hinges on Asia recovery, seasonal demand
boost
A seasonal demand lull and poor Asian buying
interest in Q2 translated into soft demand for
European LPG cargoes but a pick up is expected
by late Q3 as coronavirus restrictions are due
to lift in Asia.
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