November 4, 2019

London (GC Intelligence) — Europe demand for engineering resins and other polymers continued to soften in October, driven by seasonal factors and heightened uncertainty over Brexit and tariff disputes, increasing uncertainty and leading to a loss in confidence.

Nylons (PA) – Both the PA6 and PA66 engineering resins markets were rather depressed in October. Sellers were pushing for volumes in a low demand environment, resulting in declining offers and falling margins. A shutdown of the only feedstock plant of adiponitrile (ADN) in Europe and the structural tightness were main factors keeping PA66 prices above €3000/mt. But prices were falling fast, and spot offers were heard below this level.

Polycarbonate (PC) – After the big price decreases recently, which left sellers with negative margins on some accounts, rollovers were starting to be negotiated. There is pressure on Asian sellers to increase their presence in Europe as China’s growth wanes and PC capacity in the country is set to increase in the next few years.

Acrylonitrile Butadiene Styrene (ABS) – There was yet another margins contraction for producers in October, a pattern that has been going on since the spring. The lower profits in the Asia this year meant more efforts to sell to Europe. Competition has been so intense that negotiations are less reliant on raw material costs and more on fundamentals. Import offers were heard as low as €1300/mt or even lower.

Styrene Acrylonitrile (SAN) – The same picture as ABS emerged for SAN in October, namely there was low demand across most downstream sectors, ample availability and strong competitions from imports. There was slightly less pressure given its limited exposure to automotive, but as economic growth slows even the most resilient sectors were feeling the pain.

Polystyrene (PS) – Despite announcements of rollovers and even increases for October, there was little success and prices instead decreased €20/mt, in line with styrene. As buyers expect costs to fall further, they were holding back, causing a further dip in demand and raising expectation of probable big declines in November.

Polymethyl Methacrylate (PMMA) – The relentless slide in PMMA is continuing in Q4. There is a considerable oversupply of PMMA and its feedstock MMA which is placing pressure on prices. A similar situation in Asia meant additional pressure from imports, with offers heard as low as €1400/mt.

NOTE: For price indices, forecasts, and a more in-depth analysis take a look at the GC INTELLIGENCE® Market Reports…