Home > Chemical News

Chemical News

NWE LDPE spot prices slide; contract prices under pressure

https://www.chemnet.com   May 06,2011 Platts
European low density polyethylene spot prices dipped this week by Eur10/mt ($14.86/mt), closing Wednesday at Eur1,460-1,465/mt FD NWE on improved product availability and slow demand.

Upstream energy markets also softened this week. European naphtha closed Wednesday at $1,046.25/mt CIF NWE, down $37.50/mt on the week. At the same time, contract cracker margins improved. The increase in May olefin prices prompted contract cracker margins to more than double in May from April, closing Wednesday at Eur157/mt.

Turkish product was heard being offered at European main ports at Eur1,350-1,390/mt CIF, sources said. A converter reported buying Turkish product at Eur1,450/mt FD NWE. European traders and distributors prices offers were at Eur1,480-1,510/mt.

"The market is exhausted with price increases," a distributor said. "The Eur25/mt increase in ethylene May contract price will not likely pass on to polyethylene."

Spot prices were therefore assessed down Eur10/mt at Eur1,460-1,465/mt FD NWE.

In Turkey too, spot prices retreated to $1,730-1,735/mt CFR, as availability of Iranian product and slack demand continued to depress prices, sources said.

In the UK, spot prices were also heard softer. "Bids have fallen to GBP1,250/mt ($2,064/mt) FD, while selling interest remains at GBP1,270-1,280/mt FD," a source said.

In the April contract market, converters reported settling at either rollover or an increase of Eur10/mt. Platts LDPE assessment for April was at Eur1,620-1,625/mt FD NWE, a Eur10/mt increase for the month.

"April was a short month, and along with better availability of LDPE, we settled either at a rollover or an increase of Eur10/mt with our suppliers," a converter reported.

The May contract market was still in flux, sources said. A major European producer said it was looking at a decrease in contract prices by Eur25/mt in Europe and GBP50/mt in the UK.

"The market is weak," he said. "Gross prices for May for us are Eur1,590-1,595/mt FD in NWE and GBP1,300/mt in the UK."

But some producers were targeting increases. The ethylene May contract settled at record high levels of Eur1,230/mt, an increase of Eur25/mt on April.

Dow announced an increase of Eur100/mt for LDPE May contracts. Most converters were still to position themselves firmly. "End-user demand is slow and credit lines are maxed out," a converter said.

 Print  |    add to Favorites  |    Close