OLEFINS: US Gulf Coast spot ethylene is expected to remain stable to lower amid cracker restarts.
Spot propylene is expected to remain stable ahead of contract negotiations. October domestic propylene contracts are expected to settle this week at a rollover to decline, sources said.
VINYLS: US export polyvinyl chloride prices could rise this week form the last assessed range of $1,145-$1,155/mt FAS Houston as market participants looked toward negotiations for limited November spot volumes. Market sources expected prices to rise, as two force majeures declared on PVC in August by Formosa Plastics USA and Westlake Chemical remained in effect Oct. 26.
In addition, market players were watching Tropical Storm Zeta, which was expected to make landfall in southeast Louisiana on Oct. 28 as a tropical storm or a weak Category 1 hurricane, according to the National Hurricane Center.
Barring any shifts in its path, the storm could affect PVC operations in Geismar, Plaquemine and Baton Rouge. Zeta was not expected to affect Lake Charles, which took direct hits from hurricanes Laura and Delta within six weeks of each other on Aug. 27 and Oct. 9.
Upstream, ethylene dichloride prices could rise notionally this week, but lack of spot availability was expected to continue, particularly with the continued outage at OxyChem’s 612,000 mt/year swing EDC plant in Convent, Louisiana, which also was in the cone of Zeta’s path. Westlake has restarted its three Lake Charles chlor-alkali plants post-Delta, but market participants expected overall US chlor-alkali rates to remain in the mid-70% range this month as producers remain wary of ramping up amid soft caustic soda demand.
AROMATICS: US spot benzene prices were expected to remain firm amid continued healthy demand from the downstream styrene segment. Activity was expected to wane in the coming days as the contract negotiation period comes to a close, however, with November spot values seen at a roughly 13 cents premium to the October contract settlement of 141 cents/gal, participants anticipated higher contract pricing for benzene in November. Downstream demand from styrene remained strong with sources anticipated 50-70,000 mt loading in October and early November. At least one US Gulf Coast producer remained offline for maintenance which was expected to conclude in November. A second was heard sold out for November while a third was heard to have faced a brief disruption at its PO unit. Downstream demand for styrene remained subdued with demand from the PS segment expected to fade while the ABS and SBR segments remained soft. In aromatics, toluene and mixed xylenes were expected to fall amid market length as Citgo and P66 restart production in late October and early November.
METHANOL & MTBE: US spot methanol prices are expected to be stable to stronger this week, ahead of November contract pricing and as the market awaits potential impacts from Tropical Storm Zeta, anticipated to make landfall in Louisiana later this week. Some production continues to be talked as offline, with demand heard to be slowly rebounding from related derivative products. MTBE prices are expected to be stable to stronger on the week, with demand heard to be relatively steady and continued talk of some regional production still being offline.
LATIN AMERICA: Latin polymers are expected to see stability in the imports markets of Brazil and the West Coast of South America, expecting further movements and pricing settlements from the US market in the turnover of the month. The foreign exchange rate started the week most unchanged to the Brazilian Real at 5.63/$1 on Oct. 26. Domestic prices are expected to see new values only for November.
Polypropylene prices are expected to be stable to slightly higher on week, following small increases coming from Asia and Middle East – Brazil and the West Coast of South America imports mostly come from Asia and Middle-East if compared to the US. In the WCSA, spot import polyethylene prices are also expected to continue highly attached to the US movements on the week, therefore on the expectation of possible pricing movements for November.
The PVC market in Latin America is expecting to continuing seeing higher prices in the market as reflection of higher European values, linked to imports into Brazil, while US prices, most attached to the WCSA, is mostly flat on week. Product is still unavailable in most of the markets – very limited availability from the US for exports, which could continue to drive prices higher. In Mercosur, spot pricing new list is expected for November bookings. Some distributors restarted to report null product availability in the market. In Argentina, prices are expected be unchanged for the week, with market participants saying the currency exchange volatility has impacted the market and payments terms.