Polyolefin converters are far from active now, according to Polish market players. "There is demand and interest in prices, but customers are in no hurry to make purchases. Some of them bought large volumes last month when it became clear that the price would only be rising," a Polish trader said. "Both polyethylene and polypropylene are in demand. However, PE availability is being asked for more often," another elaborated.
The market remains short of the material. LDPE is reportedly the scarcest. "Whatever we can buy, we sell it immediately. It is not possible to build any LDPE stock," a Polish trader remarked. "Germany-based producer has not given any volumes of this material," they added.
One if the Central European producers is known to have refused to sell polypropylene to a Polish trader. A global maker is withholding September LLDPE and HDPE output from its Saudi Arabian assets, only offering the products from the European ones. The company is also putting HDPE up for sale under long-term contracts rather than spot ones. The Uzbek producer has put no HDPE on the market yet. LyondellBasell has announced the permanent closure of its PP plant in Italy.
PE and PP prices have risen more than predicted. Producers most probably decided to "take the reins of the market" and refuse to sell the materials at lower levels. As facilities have been operating at reduced capacity of 70-80%, keeping the materials in stock instead of selling them and suffering from economic instability in Poland and Europe for a while, the market has faced a shortage and a possibility of price increases. Some producers, however, are refusing to give discounts of even €20/t now, according to Chem-Courier’s sources.
A global polyolefins manufacturer has raised quotes to Polish customers by an average of €140/t in September. Central and Eastern European producers have put those for PP €120-180/t up.
Converters will return to purchases in H2 September. They are eyeing the situation in hope of price cuts now. However, PE and PP makers have no plans to implement them. Chem-Courier expects polymers to hold their value until end-September. In October, prices will probably go up again. Chem-Courier has already received confirmation of a transaction in film LDPE at €1,235/t DDP for October delivery.
