Petrotahlil - POLYMERS: US polyethylene prices are expected to increase as market participants note prices are being pushed higher by producers and other market players.
One source said there is denial from traders, but previously heard lower pricing will not transact anymore. S&P Global Platts last assessed week on week Aug. 5 for US spot export PE pricing with low-density PE unchanged at $992-$1014/mt FAS Houston, linear low-density PE was also stable at $794-$816/mt FAS Houston and high-density PE blowmolding was $22 higher at $849-$871/mt FAS Houston. In domestic PE markets, contacts were flat after increasing 5 cents the previous week based on producers pushing for higher pricing domestically. Meanwhile, in US polypropylene.
In US polypropylene, the market is still dealing with a 6 cpp uptick following a firmer upstream propylene settlement. Market participants have seen limited to no offers for export PP and expect the market to remain tight during the beginning of August. Also, US polymer producer Formosa Plastics Corp. announced a force majeure on polypropylene products from its Point Comfort, Texas, petrochemical complex effective Aug. 8, the company said in a letter obtained by S&P Global Platts Aug. 10. "As a result of this production outage and pursuant to Formosa's General Terms and Conditions of Sale, Formosa is declaring Excuse of Performance (force majeure) on its Formolene polypropylene products effective Aug. 8, 2020," the letter said. Pricing is expected to continue to climb in the short term amid tight availability and limited offers for exports, sources said. S&P Global Platts assessed the homopolymer injection contract price Aug. 5 at 50-51 cents/lb ($1,102-$1,124/mt) on a delivered-via-railcar basis.
VINYLS: US export polyvinyl chloride prices were expected to be stable this week as the market expects Asian producers to announce fresh September offers, often seen as a bellwether of US price movement. Asian market sources expect those offers to be $20-$40/mt above August settlement levels. US pricing rose $15/mt above the August settlement to $785-$795/mt FAS Houston on an incremental deal done at $1,000 mt, but supply remains tight amid continued reduced rates, turnarounds and slow ramp-ups upon maintenance work completion. Those factors were expected to keep supply tight into September as producers seek a third consecutive monthly price increase of 3 cents/lb for domestic material. Upstream, spot ethylene dichloride availability remained largely nil as integrated producers kept EDC output internal for downstream PVC production.
LATIN AMERICA: Latin polymers are expected to see stable to higher prices during the week in the imports markets of Brazil and the West Coast of South America, while expected to see stability in the domestic markets after announced increases of the past week. The Mercosur region is expected to see higher prices. The foreign exchange rate started the week unfavorable to the Brazilian Real, reaching 5.41/$1 on August 10. Domestic producer had implemented increases last week and prices are expected to be unchanged. Sources have been reporting lack of availability of several products in the domestic market of Brazil. Polypropylene prices are expected to be stable to higher on the week, strengthening with values in Asia and the Middle East -- polypropylene imports into Brazil and the West Coast of South America region mostly come from Asia and the Middle East. In the US, in contrast, polypropylene prices increased $132/mt last week, with supply expected to remain tight due to Formosa's PP plant force majeure announcement.
In the WCSA, spot import polyethylene prices are expected to continue highly attached to the US movements on the week, therefore expected to be stable to up, considering possible higher August settlements, yet to be implemented. The PVC market in Latin America is also expecting to see higher prices from the US, Europe and Asia, reflecting on imports to the region. Demand has been picking up, as per sources feedback. The Brazilian market has been reported tight on product and prices are expected to climb fast. In Mercosur, spot pricing new list was already expected for August bookings since two weeks ago and no new prices have been available. Distributors believe higher prices could reach the market. In Argentina, prices were increased in $110/mt for all polyethylene products last week, therefore no further increases are expected for the week. However, distributors believe the local producer could push more hikes for August, depending on the acceptance of the market.
METHANOL & MTBE: US methanol prices are expected to be stable to slightly weaker this week, with stable demand heard in the market for derivative products. Supply disruptions at a Trinidad methanol production facility could be resolved this week, serving to ease production constraints. US spot MTBE is expected to continue to hold a wider discount to front-month NYMEX RBOB futures with limited buyers heard in the market and some spot material still available for first-half August.
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Source : Platts