The European ethylene market looks stable as the recent length has cleared following a spate of exports to Asia.
OLEFINS
For propylene, early expectations for the May contract price are mixed, with some market participants expecting a rollover but others predicting an increase on the back of stronger feedstock prices.
The European butadiene market remains tight, with market sources attributing this to both good demand and limited crude C4 availability. However, sellers are continuing to seek export opportunities.
Meanwhile, contract price negotiations are expected to get underway in earnest this week. The continuing gap between spot and contract price levels is already a talking point in the market.
POLYMERS
The polyethylene market in Europe looks to fairly stable with a perception among some participants that the bottom has now been reached for LDPE. Sentiment is expected to improve owing to the seasonal rise in volumes.
As for polypropylene, demand is picking up in Europe after an unusually quiet start of the month, and as market players try to secure material before the propylene contract price settlement for May.
Large price increases in Asia and the upcoming high-demand season in Europe look set to underpin European PET prices. Imports from Asia remain uncompetitive because of the price rises. Feedstock PTA production has been affected due to outages in Europe, which is expected to impact PET availability in May.
In the polystyrene and acrylonitrile butadiene styrene markets, expected price decreases in May are likely to limit buying activity for the rest of April. However, some concerns for availability have crept up for May-June as inventories at converters are heard to be low.
In addition, imports are expected to remain limited as offers from Asia are uncompetitive, in light of the bearish outlook for prices in May-June.
AROMATICS
European styrene prices are expected to ease amid an improvement in supplies globally. In addition, imports from the US will continue to loosen fundamentals, keeping the market backwardated. In the feedstock benzene market, plentiful supplies have kept prices disconnected from the bullish energy complex.
There is limited upside to benzene prices, although production in the downstream styrene market is set to rise in Europe with plants coming back online. Toluene and MX demand remains weak for prompt dates as downstream TDI and PTA plant outages persist.
While bids have been seen for May dates in recent trading sessions, it remains to be seen whether May selling interest surfaces this week.
METHANOL/AA
Planned ongoing and upcoming turnarounds both within and outside of Europe remain the main talking point in the European methanol market, as the market prepares for production stoppages throughout the second quarter.
Good demand levels, typical of the season, have been further supported by these preparations. Downstream, European acetic acid prices near seven-year highs rose further last week to Eur800/mt FD NWE on persistent global supply tightness.
Europe-based traders in acetic acid have also been seeking June volumes in a market normally typified by prompter trading, seller sources said Thursday, as market participants seek to secure and lock down volumes further out.
