Polymerupdate global resin pricing Dec. 8-12: Price freefall continues, with Chinese New Year looming, and Middle Eastern resins

Polymerupdate (www.polymerupdate.com) reports that prices for key polymer feedstock ethylene were steady in Asia, with CFR Asia prices assessed at $430-$440/tonne. Downstream, high-density polyethylene (HDPE) film grades were unchanged at $840/tonne CFR Far East. Low-density polyethylene (LDPE) prices were assessed at $890-$900/tonne CFR Far East, while linear low-density polyethylene (LLDPE) prices were assessed at $840-$850/tonne CFR Far East. Polymerupdate notes that with the Chinese Lunar holidays set to begin on Jan. 26, PE markets in Asia were expected to weaken, dragging HDPE, LLDPE, and LDPE prices further down.

A sudden influx of deep sea propylene cargoes into Asia kept spot buyers from purchasing at the current price of $500/tonne FOB Korea for propylene. In the downstream polypropylene (PP) market, prices have softened, with raffia currently quoting at $760/tonne CFR Far East mark, while offers for PP injection have fallen to $770/tonne CFR Far East. PP film offers are pegged at $790/tonne CFR Far East. In spite of these low levels, buying interest across most parts of Asia remains dull.

Polystyrene (PS) buyers in Asia are patiently awaiting further price drops, even as general-purpose grades fell to $700/tonne CFR South East Asia and CFR China. High-impact prices fell to $810/tonne CFR China and CFR South East Asia. Polymerupdate notes that many PS producers, anticipating difficult times, reduced runs at their plants, with some even dipping below 50% production rates.

Also in styrenics, acrylonitrile butadiene styrene (ABS) dropped, with CFR China prices of ABS on Friday falling to $1200/tonne, while CFR South East Asia ABS prices dropped to $1240/tonne. In plant news, LG Chem plans to maintain production rates at its 500,000 tonnes/yr ABS plant at Yeosu at 50% through December. Its joint-venture ABS plant located in Ningbo, China—LG Yongxing—is also running at below 50% rates.

In European news, contract LDPE prices fell to euro 750/tonne FD North West Europe, while in the spot market, LDPE fell to euro 640/tonne FD north West Europe. Despite the decline, Polymerupdate notes that buying interest has failed to improve.

LLDPE contract and spot prices also plunged on year-end pressures to keep inventories low; falling prices of crude, naphtha, and ethylene; and the impact of a slowing global economy. Contract LLDPE prices dropped to euro 800/tonne FD North West Europe. In the spot market, prices fell to euro 690/tonne FD north West Europe. A converter contacted by Polymerupdate felt that prices are likely to fall further, with new material capacity coming online in the Middle East offsetting disciplined polyolefin production on the continent.

PP prices also fell, with contract prices for homopolymer injection grade PP down to euro 955/tonne FD North West Europe, while copolymer contracts settled at euro 1010/tonne FD North West Europe. In the spot market, homopolymer prices fell to $640/tonne FD North West Europe, while copolymer prices fell to euro 690/tonne FD North West Europe. Here too, participants contacted by Polymerupdate felt that Middle Eastern PP sellers are further depressing the local market as they look to unload material once destined for China.

European contract and spot prices for polyvinyl chloride (PVC) both fell, with suspension-grade PVC contracts at euro 950-970/tonne FD North West Europe, with spot prices at euro 620-640/tonne FD North West Europe.

PS dropped as well, with contract general-purpose prices at euro 1150/tonne FD North West Europe, down from euro 1200/tonne FD the week before. High-impact contract prices fell to euro 1220/tonne FD North West Europe, down from euro 1265/tonne the week before. Spot general-purpose prices fell to euro 760/tonne FD North West Europe, while high-impact spot prices settled at euro 820/tonne FD North West Europe.

Contract prices of natural-grade ABS fell to euro 1650/tonne FD North West Europe, off from euro 1700/tonne FD the previous week. An ABS buyer contacted by Polymerupdate laid out the bleakness of the situation: “Seeing the strong impact of global recessionary trends on ABS consumption has convinced us that sellers will struggle to find buyers even at the start of next year.”