The European polyethylene (PE) market is quiet this week as everyone waits for the November ethylene price settlement. Suppliers are aiming to pass on any monomer increases in their November contracts, but supply and demand don’t really support price hikes beyond that.
Spot Market:
- Deals are limited. Some buyers tried to lock in purchases before potential monomer price increases. However, most buyers are holding back due to weak demand, hoping to clear out existing stock before the end of the year. Some lower prices were heard, but it’s hard to say if that’s a trend yet.
Contracts:
- Contract talks haven’t started, but LDPE is in a better position than other PE grades thanks to fewer aggressive import offers. Possible disruptions to LDPE supply from Italy could also impact the market. For HDPE and LLDPE, competitive spot offers might make contract negotiations tougher.
LDPE: Limited spot activity, with prices mostly within the established range.
LLDPE: Quiet week, but some continue to quote prices below €1,000/tonne. European producers aren’t matching these low prices. Cheaper imported LLDPE C4 is being used as a substitute for the pricier metallocene C6.
HDPE: Few reported deals, but prices are holding steady. Injection molding grades see the lowest offers.
Upstream Market:
- Ethylene: November contract prices are up €30/tonne due to higher feedstock costs. The market is slow due to holidays and end-of-month timing. Supply is plentiful, but demand is slowing.
- Naphtha: Spot prices are stable, crack spread is firming, and regional inventories are slightly down.
- Crude Oil: Prices dipped due to hopes of easing Middle East tensions, but OPEC+ might delay output increases, and Chinese manufacturing activity is picking up, which could support prices.
Looking Ahead: Expect more activity in the lead-up to Christmas. Supply pressure on exporters might lead to some competitive offers on certain grades.