Market Insights

April 1, 2015 • Posted in Market Insights

Energy and the Economy

  • Oil fell over the weekend but prices remain above last week’s levels. Predictions still call for oil to drop below $40/bbl in the second quarter. Speculation regarding an Iranian nuclear agreement is also feeding the downward pressure on the oil market
  • The US dollar weakened with strong economic indicators coming out of Europe, weaker February orders for US durable goods and turmoil in Yemen causing market turmoil
  • Factory activity in China appears to have slipped in March but the outlook for the China market continues to remain bullish with exports expected the increase

Ethylene and Polyethylene

  • Gas prices dropped at the end of the week bringing down ethane.
  • Ethane prices still remain above fuel level. Demand will remain weak until summer weather increases power demand for cooling
  • February ethylene settled down 0.5 cpp to 34.75 cpp
  • INEOS announced 4 cpp on HDPE eff. April 1
  • Domestic demand appears to be increasing as converters restock
  • More PE price announcements are expected for April

 Propylene and Polypropylene

  • March monomer settled down 1.5 cpp to 49 cpp
  • Initial nomination for April hears at 1 cpp down from March
  • Demand for March continues to be reported as strong
  • Wide-spec prices remain above prime pricing
  • P66 still operating under force majeure
  • Pinnacle continues under force majeure but indications are they will exit in April

Styrenic Feedstock and Polymers

  • March benzene contract negotiations concluded with a split settlement of $2.04 – $2.08 /USG, an increase of $0.03 to$0.07/USG over February..
  • Spot benzene prices pushed up ending at $2.58 to$2.67 per USG for April
  • Arbitrage window with Asia appears to be reopening
  • February styrene monomer NT Contract pricing rolled flat from January at 52.5 cpp
  • Rising benzene and styrene monomer prices and improving demand could lead to polystyrene price increase announcements for April/May
  • General purpose ABS prices increased in both Europe and Asia due to higher styrene prices and increased demand.

Engineering Thermoplastics

Polycarbonate – Prices firmed in Europe and moved up in Asia on higher cost. Price increases have been announced by Bayer on global products and Trinseo (Styron) in Europe. The moves are supported by generally tighter supply.

Nylon – Prices rose in Asia with stronger feedstock pricing. Supply is more than adequate in all regions.

Polyacetal – North American demand is improving on fundamentals and prices are unchanged this month. Asian prices increased in line with methanol prices and with support from inventory re-stocking.

 

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