LOS ANGELES
,
April 6, 2023
(Industry Intelligence Inc.)
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US Resins US spot resin trading continued to improve near the end of March, bringing the month to the busiest thus far in 2023. During the week of March 27, most spot PE grades fell by US$0.01/lb despite somewhat tight supply. Nevertheless, spot HDPE resins averaged a $0.06/lb increase during the first three months of 2023. Spot LDPE and LLDPE fell $0.02/lb in March, but still netted an increase of $0.02/lb for the first three months of the year. At the end of March, PE contracts were not fully settled, with some market sources expecting a $0.03/lb increase to succeed, while others see it unlikely. Several producers have also proposed an April contract hike of $0.05/lb. Spot PP trading during the week of March 27 was solid, but prices decreased in line with falling spot polymer-grade propylene. PP contracts for March, meanwhile, settled up US$0.08/lb for a total increase of about $0.23/lb for 2023. The primary source of this information is Plastics Today. Europe Ethylene Weak demand for European ethylene has persisted throughout the first quarter of the year, owing largely to lackluster consumption across food packaging, automotive and construction industries. While the ethylene contract price for March settled at an increase of €30/tonne, downstream markets had difficulty selling at higher prices to consumers where demand was already weak. Nevertheless, ethylene supply and demand dynamics for the month of March were relatively balanced as producers cut capacity utilization to between 70% and 80% of capacity. European ethylene spot prices in March averaged €915.67/tonne FD Northwest, down €14.33/tonne compared to February, according to S&P Global Commodity Insights Data. For downstream PVC, weak demand led spot prices downward by €50/tonne week-on-week, hitting €1,090/tonne on April 5, according to Platts. For ethylene, demand will likely remain limited through the second quarter. European producers don’t appear likely to increase their capacity usage in the immediate future, according to market sources. The primary source of this information is S&P Global Platts. Asia Paraxylene The Asia contract price for paraxylene settled at US$1,085/tonne CFR Asia on March 31, reaching the first settlement since March 2021. Production turnarounds in the region have restricted supply and encouraged higher PX prices in recent weeks. Both ExxonMobil and Japan-based ENEOS settled at $1,085/tonne in their supply agreements with PTA producers. In March 2021, contracts settled at $870/tonne. Meanwhile, the PX-naphtha spread soared to US$455.88/tonne on March 31, up US$150.71/tonne on March 1. The growing spread also played a role in buyers’ willingness to consider a contract price settlement. Market participants expect the bullish PX market to ease eventually, providing less incentive for Asia contract price settlements to occur repeatedly. The primary source of this information is S&P Global Platts.
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