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Plastics pricing: PET prices up all over the globe, PS sails higher in Europe

Plastics processors in need of polyethylene terephthalate are forced to pay more for the material as feedstock process climb, driven by a mixture of demand and some outages. For processors in Europe, polystyrene prices also are climbing as demand has steadily risen and is expected to continue climbing into March. Adding to the pricing pressure for PS is the upheaval in the Middle East which has sent crude oil prices to top, briefly at least, $100/barrel.

Plastics pricing consultancy ChemOrbis (Istanbul, Turkey) shared its interpretation of the current plastics pricing situation. For PET processors in Asia and Europe, prices are under upward pressure due to escalating feedstock prices, with the price hikes also powered in Europe by PET and PTA force majeures.

In Asia, spot feedstock costs recorded increases with respect to the beginning of February. PTA costs moved up by $45/ton while MEG prices gained $50/ton on CFR China basis. Meanwhile, spot PX offers rose by $40/ton on FOB Korea basis.

In China's domestic market, the overall range gained CNY100-300/ton ($15-46/ton) when compared with the previous week's range.  Suppliers are not shy about predicting further hikes as most beverage factories are resuming their normal operations following the extended Chinese New Year holiday.

In the import market, South Korean PET prices gained $50/ton increases at the low end while they moved up by $10/ton at the high end on FOB Busan, cash basis. However, reports ChemOrbis, no major deals have been reported so far due to the large gap between the current buy and sell targets. In China's export market, the overall range saw $50/ton hikes at the low end and $30/ton hikes at the high end over the past week on FOB China, cash basis. PET suppliers and traders are complaining about their slow sales, says ChemOrbis, and some are willing to concede to discounts given the slightly softened feedstock costs towards the end of last week although several others prefer to maintain their prices at their current levels. These sellers feel optimistic about the future trend as they are receiving an increasing number of inquiries from their overseas' customers.

In Europe, spot PX prices gained $90/ton when compared to the beginning of February on FOB NWE basis. PTA supplies are tight in the region due to BP's force majeure at its PTA 3 plant. According to ChemOrbis, the plant is now running at 85% capacity and the company is able to meet its contractual obligations. However, the company is due to shut the plant on February 26 for 9-10 days of maintenance on the back of another technical problem. During this period, it will reduce allocations to 30-40%.

BP's PTA force majeure has already affected the PET market as La Seda de Barcelona was also forced to declare force majeure on PET last week as it has been unable to source enough feedstock. La Seda reportedly put its customers on 60-80% of allocation.

Spot styrene prices in Europe have been moving up since the first half of February. The expectation of better demand in March versus dwindling supplies across the region is behind the movement, reports ChemOrbis.
 
After slipping slightly in the first week of February, spot styrene prices in Europe posted incremental increases in the following weeks of the month in line with the firmer crude oil and benzene costs, with the total increase amount reaching $140/ton compared to the lowest figure seen in early February.     
 
The turmoil in the Middle East is having its affect on crude oil prices, which today topped $100/barrel in New York, reported Bloomberg, the first time triple-figure prices had been hit since October 2008. Following these developments, spot styrene prices for March were heard even higher, indicating a further $20-25/ton increase over the earlier level, according to market sources contacted by ChemOrbis.
 
Gaining support from the strong oil market, benzene prices also rose significantly this month. Prices moved up more than $45/ton above the early February levels in Europe. In addition, the plant maintenance season is approaching for crackers across Europe on top of the existing supply outages at a couple of West European producers. —MPW Editorial

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