Some Polish traders are claiming converters are showing rather strong demand for polyolefins. "Many customers are interested in prices and will most likely start restocking in August" - a market participant said. PP and PE converters are equally keen to get quotes. There is no information about any transactions yet as the market is waiting for offers from those producers that have not released their price lists yet. "We see enough volume on the market to cover customer needs, but there are many rumours about capacity cuts and production stoppages. We are waiting for information about new volume allocations for August from manufacturers" - a trader has elaborated.
According to unconfirmed information, French and UK producers have either reduced capacity utilisation or stopped their PE facilities. There is talk that the Serbian manufacturer will cancel all orders this week if nobody confirms the volume needed. Also, at the end of July, the PP manufacture was stopped at a Belgium-based facility due to a force majeure event. It is also known that PP has been out of production at Spain’s Repsol and Austria’s Borealis for more than two months.
The situation with the off-grade material is unchanged: it is still in short supply. "We have sold all the stocks" - said one Polish trader. Another, which also specializes in off-grades, has verified the lack of this kind of the material on the market and said that its prices have been only €50/t lower than those for prime grades this month.
Although some European manufacturers are still undecided about new prices, it is already clear that prices are rising. The bottom of the price range for most polyolefins has rebounded from last month’s level of €900/t to the June one of €1,000/t. PE spot prices have gained €20 - 55/t depending on the polymer type. The situation with polypropylene is similar, with traders reporting that European PP priced below €1,000/t is unavailable on the market.
The panic among traders that the market witnessed last month has petered out. They are no longer selling the materials at minimal margins and will do their best to keep prices at the current levels. However, a stampede to buy polyolefins may begin among converters now. Rumours about possible shortages and further price increases may prompt them start restocking with the material instead of buying it ad hoc. Prices are unlikely to return to a level below €1,000/t this month.
