PE sellers in Europe are said to be planning to seek increases beyond the rise in the ethylene contract for May even after achieving three digit hikes on their April business, according to ChemOrbis. Firm costs as well as persistently tight supply driven by a number of outages in the region were cited among the main factors pushing sellers to seek another month of large price hikes in May.
A source from a West European producer said that they are planning to announce increases of at least €100/ton for May after settling their April gentleman’s agreements with €180/ton hikes. “The €80/ton hike in the ethylene contract was in line with our expectations. We believe that higher costs and tight supply will allow us to obtain another round of price hikes for May,” the source added. A distributor based in Italy said that they expect to see another round of price hikes for May as supply is not likely to loosen while many end product applications will be entering their high seasons soon. A distributor based in Germany expressed their May sell ideas for West European PE with €100-150/ton increases after achieving price hikes of €200/ton on their April deals. “Supply remains tight while the ethylene contract settled €80/ton higher and these factors should generate additional increases in PE prices,” the distributor stated. A packaging converter in Germany said that they expect to receive €100/ton increases for May owing to persistently tight supply and in spite of disappointing demand for their end products as per ChemOrbis pricing service.
In production news, France’s Total reportedly shut its NC2 cracker in Antwerp, Belgium due to a technical issue. The plant has an ethylene capacity of 610,000 tpa. Meanwhile, several force majeures reportedly remain in place in the region. Total had earlier declared a force majeure on HDPE output from its 250,000 tpa plant in Gonfreville, France. Ineos’ 540,000 tpa HDPE plant in Lillo, Belgium is said to be running at reduced rates after the company declared a force majeuere from the site in late March.
SABIC is said to be running its 175,000 tpa HDPE/LLDPE swing plant in Gelsenkirchen, Germany at improved rates after experiencing a technical issue at the plant. However, sources report that the force majeure declared in late March remains in place. LyondellBasell was expected to restart its 320,000 tpa HDPE plant in Muchmunster, Germany in late April after having declared a force majeure from the site on March 20. A force majeure is also said to remain in place at Borealis’ PE plant in Schwechat, Austria even though the plant is slated to restart in late April. In addition, Versalis also declared a force majeure on the output from its Dunkirk site in France in mid-March. The facility is able to produce 210,000 tons/year of LDPE and 140,000 tpa of LLDPE.