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POLYMERSCAN
Volume 36 / Issue 20 / May 15, 2013

Americas Polymer Spot Price Assessments


FAS Houston US Contract US Domestic FOT Brazil* CFR Brazil CFR PERU ($/mt) dlvd railcar ($/mt) ($/mt) ($/mt) ($/mt) (cts/lb) PVC SUSP 895-905 52.00-54.00 1146.08 -1190.16 - 1080-1090 1020-1030 LDPE G-P 1411-1433 83.00-84.00 1829.32 -1851.36 1600-1610 1520-1530 1530-1540 LLDPE (Butene) 1400-1422 70.00-71.00 1542.80 -1564.84 1595-1605 1505-1515 1490-1500 HDPE Inj 1444-1466 72.00-73.00 1586.88 -1608.92 1580-1590 1495-1505 1485-1495 Bmldg 1400-1422 72.00-73.00 1586.88 -1608.92 1535-1545 1465-1475 1465-1475 Film 1466-1488 75.00-76.00 1653.00 -1675.04 1605-1615 1500-1510 1525-1535 Yarn - - - PP Homo Inj 1455-1477 72.00-73.00 1586.88 -1608.92 1600-1610 1520-1530 1515-1525 Fiber - 73.00-74.00 1608.92 -1630.96 - - Copol 1466-1488 - 1625-1635 1545-1555 1555-1565 IPP Film BOPP PS G-P 1890-1900 106.00-108.00 2336.24 -2380.32 - HIPS 2020-2030 117.00-119.00 2578.68 -2622.76 - ABS Inj - 122.00-124.00 2688.88 -2732.96 - PET bottle grade 1720-1742# 1808-1830##
Notes: All price assessments reflect spot trades with the exception of US Contract Delivered railcar. * FOT Brazil assessments are for export material via truck to MERCOSUR markets. # US PET bottle grade refers to DDP US West Coast. ## US PET contract price is in $/mt.

Asian Polymer Spot Price Assessments


CFR FE Asia CFR SE Asia ($/mt) ($/mt) CFR China South Asia Domestic ($/mt) (Yuan/mt)

Contents
Polymers Polyvinyl Chloride 4 Low Density Polyethylene 6 Linear Low Density Polyethylene 7 High-Density Polyethylene 8 Polypropylene 10 Polystyrene 12 Acrylonitrile Butadiene Styrene 14 Polyethylene Terephthalate 15 Polymer Feedstocks: Olefins Ethylene 18 Ethylene Glycol 19 Propylene 20 Butadiene 21 Polymer Feedstocks: Aromatics Paraxylene 24 Styrene 25 Polymer Feedstocks: Intermediates Purified Terephthalic Acid 27 Acrylonitrile 28 Ethylene Dichloride / Vinyl Chloride Monomer 29 News 30

PVC SUSP 957-958 959-961 994-996 ^6840-6860 ^^6510-6530 LDPE G-P 1389-1391 1404-1406 - 11330-11370 LLDPE (Butene) 1374-1376 1389-1391 1409-1411 10480-10520 HDPE Inj 1389-1391 1419-1421 1409-1411 Bmldg 1384-1386 1419-1421 1409-1411 Film 1419-1421 1429-1431 1439-1441 11280-11320 Yarn 1449-1451 1439-1441 - PP Raffia 1388-1390 1439-1441 1434-1436 10480-10520 PP Injection 1388-1390 1439-1441 1434-1436 Fiber - - Copol 1414-1416 1459-1461 1469-1471 IPP Film 1409-1411 1454-1456 1449-1451 BOPP 1399-1401 1449-1451 1449-1451 PS G-P 1779-1781 1829-1831 - HIPS 1859-1861 1919-1921 - EPS G-P 1819-1821* EPS F-R 1894-1896* ABS Inj 1892-1894 1919-1921 - PET bottle grade 1409-1411 * 1424-1426 ** - Notes: Asian PVC, PS, and ABS, FE Asia refers to China. All Asian polymer assessments are basis L/C 0-30 days Credit differentials calculated using 1 month LIBOR +1.5%. ^Denotes ethylene-based production ^^Denotes carbide-based production. EPS F-R refers to fire retardant grade. *Denotes FOB North East Asia (South Korea, China, Japan) **Denotes FOB Southeast Asia (Thailand, Indonesia , Vietnam, Malaysia).

Platts Polymerscan

May 15, 2013

Daily Polymer Spot Price Assessments


CFR FE Asia ($/mt) HDPE film LDPE LLDPE PP Raffia PP Injection FD NWE (Euro/mt) LDPE LLDPE PP Homo FCA Antwerp (Euro/mt) LDPE LLDPE PP Homo FAS Houston ($/mt) LDPE LLDPE PP Homo HDPE Blmldg HDPE LDPE LLDPE PP Raffia PP Injection 1389-1411 1389-1411 1400-1422 1422-1444 1378-1400 1378-1400 1389-1411 1411-1433 1422-1444 1422-1444 1422-1444 1433-1455 1328-1350 1328-1350 1334-1356 1350-1372 1387-1389 1392-1394 1392-1394 1392-1394 1367-1369 1377-1379 1377-1379 1377-1379 1357-1359 1362-1364 1362-1364 1364-1366 1372-1374 1374-1376 1377-1379 1371-1373 1370-1372 1374-1376 1377-1379 1371-1373 1411-1433 1400-1422 1455-1477 1400-1422 1402-1404 1372-1374 1357-1359 1371-1373 1371-1373 1402.20-1424.20 1391.20-1413.20 1430.80-1452.80 1348.00-1370.00 1393.0-1395.0 1374.00-1376.00 1360.40-1362.40 1373.00-1375.00 1372.60-1374.60 1160-1165 1160-1165 1160-1165 1165-1170 1160-1165 1160-1165 1160-1165 1160-1165 1105-1110 1105-1110 1105-1110 1105-1110 1230-1235 1180-1185 1110-1115 1175.00-1180.00 1164.00-1169.00 1106.00-1111.00 1180-1185 1180-1185 1180-1185 1185-1190 1180-1185 1180-1185 1180-1185 1180-1185 1125-1130 1125-1130 1125-1130 1125-1130 1250-1255 1200-1205 1130-1135 1195.00-1200.00 1184.00-1189.00 1126.00-1131.00 1404-1406 1409-1411 1409-1411 1409-1411 1384-1386 1394-1396 1394-1396 1394-1396 1374-1376 1379-1381 1379-1381 1381-1383 1389-1391 1391-1393 1394-1396 1388-1390 1387-1389 1391-1393 1394-1396 1388-1390 1419-1421 1389-1391 1374-1376 1388-1390 1388-1390 1410.00-1412.00 1391.00-1393.00 1377.40-1379.40 1390.00-1392.00 1389.60-1391.60 Thursday Friday Monday Tuesday Wednesday Average

FOB Middle East Netbacks ($/mt)

Notes: The weekly average represents the average of Thursday through Wednesday of the previous week. FOB Middle East netback denotes CFR Far East Asia assessments minus the prevailing container freight rate from Al-Jubail to Shanghai for a standard 20-foot container.

Polymer Spot Freight Rates ex-Middle East ($/mt)


From: To: East China South China India Southeast Asia NW Europe Turkey US Gulf Latin America Middle East 25-100 mt 15-30 15-30 40-45 30-40 65-75 65-75 135-145 160-170 Middle East >100mt 10-25 10-25 35-40 25-35 60-70 60-70 130-140 155-165

Platts Podcast
Styrene premium over benzene doubles in May amid heavy run cuts
Platts European petrochemical reporters discuss the cause and effects for recent volatility in the premium of styrene over benzene, fundamental changes and the outlook ahead. http://plts.co/12xjxaH

Notes: Please refer to the methodology guide for details on port locations.

Metals
Aluminum Tin Tin US US Europe May 14 May 13 May 10 cts/lb cts/lb $/mt 94.253 972 21029-21139
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*From October 17, PP-raf a/injection assessment was replaced by PP-raf a for CFR FE Asia

Copyright 2013, McGraw Hill Financial

Platts Polymerscan

May 15, 2013

Euro Contract Assessments (Euro/mt)


Germany Holland Italy France Spain Britain* FD NWE CP** ($/mt) PVC susp Gross 815-820 815-820 815-820 815-820 815-820 760-765 1048-1054 PVC susp Net 785-790 785-790 785-790 785-790 785-790 690-695 LDPE G-P LLDPE C4 (Blown film) LLDPE C4 (Cast stretch film) LLDPE C6 (Blown film) LLDPE C6 (Cast stretch .film) HDPE HDPE HDPE HDPE HDPE Inj Bmldg Film HMW 2-5 HMW 5-10 1360-1365 1360-1365 1330-1335 1355-1360 1330-1335 1150-1155 1748-1755 1290-1295 1290-1295 1290-1295 1290-1295 1290-1295 1090-1095 1658-1665 1290-1295 1290-1295 1290-1295 1290-1295 1290-1295 1090-1095 1658-1665 1360-1365 1748-1755 1360-1365 1748-1755 1315-1320 1315-1320 1315-1320 1315-1320 1315-1320 1111-1115 1691-1697 1345-1350 1345-1350 1345-1350 1345-1350 1345-1350 1136-1140 1729-1736 1255-1260 1255-1260 1255-1260 1255-1260 1255-1260 1060-1064 1613-1620 1365-1370 1365-1370 1365-1370 1365-1370 1365-1370 1153-1157 1755-1761 1360-1365 1360-1365 1360-1365 1360-1365 1360-1365 1149-1153 1748-1755 1280-1285 1280-1285 1270-1275 1280-1285 1270-1275 1081-1085 1646-1652 1330-1335 1330-1335 1320-1325 1330-1335 1320-1325 1124-1128 1710-1716 1565-1575 1565-1575 1565-1575 1565-1575 1565-1575 1324-1332 2012-2025 1675-1685 1675-1685 1675-1685 1675-1685 1675-1685 1417-1425 2153-2166 1595-1605 1595-1605 1595-1605 1595-1605 1595-1605 1349-1357 2051-2063 1910-1920 2210-2220 2260-2270 1355-1361 1255-1260 1345-1351 1245-1250 1910-1920 1910-1920 1910-1920 1615-1624 2455-2468 2210-2220 2210-2220 2210-2220 1869-1878 2841-2854 2260-2270 2260-2270 2260-2270 1911-1920 1355-1361 1355-1361 1355-1361 1112-1118 1315-1322## 1080-1085 1277-1283##

PP Homo Inj PP Copol GPPS Net HIPS Net EPS ABS GP/Nat ABS Ave color ABS Auto black PET bottle grade PET bottle grade PET bottle grade Net PET bottle grade Net APET film grade APET film grade Net

1613-1620

Notes: *FD Britain = FD UK, with assessments in British Pounds per metric ton. **FD NWE CONTRACT PRICE denotes FD Germany converted into US dollars. ## PET bottle grade assessments basis FD UK are in Euro/mt. PET assessments refer to regular business at prices negotiated between buyers and sellers on a monthly basis. LLDPE C6 denotes products from Ziegler-Natta catalyst.

Platts European and African Polymer Spot Price Assessments


FOB NWE FD NWE FCA Antwerp CFR Russia* CFR Turkey** CFR North Africa FD UK ($/mt) (Eur/mt) (Eur/mt) (Eur/mt) ($/mt) ($/mt) (GBP/mt) PVC SUSP 1040-1045 800-805 795-800 1070-1075 ($/mt) 1022-1028 LDPE G-P LLDPE (Butene) HDPE Inj Bmldg Film PP Homo Inj PP Raffia PP Copol PS G-P HIPS EPS ABS GP/Nat PET bottle grade PET bottle grade Recycled PET Recycled PET 1550-1555 1250-1255 1230-1235 1310-1315 1500-1505 1485-1490 - 1200-1205 1180-1185 1260-1265 1430-1435 1470-1475 1520-1525 1225-1230 1205-1210 1285-1290 1490-1495 1450-1455 1480-1485 1180-1185 1160-1165 1240-1245 1490-1495 1460-1465 1480-1485 1180-1185 1160-1165 1240-1245 1490-1495 1460-1465

1430-1435 1130-1135 1110-1115 1190-1195 1470-1475 1465-1470 1470-1475 1465-1470 1470-1475 1170-1175 1150-1155 1230-1235 1505-1510 1500-1505 1930-1940 1480-1490 1880-1890 1910-1920 2030-2040 1590-1600 1980-1990 2010-2020 1970-1980 1515-1525 1920-1930 1988-1998*** 1622-1630 1250-1255 1010-1015

1070-1075 1265-1271# 865-870 1023-1029#

Notes: FOB NWE prices are based on exports of 300mt or more. *CFR Russia denotes CFR St Petersburg; ** CFR Turkey denotes CFR Istanbul; *** ABS GP/Nat denotes CFR NWE in $/mt. # PET bottle grade and Recycled PET assessments for FD UK are in Euro/mt. Recycled PET assessments are for a hot wash flake without food approval.

Copyright 2013, McGraw Hill Financial

Platts Polymerscan

May 15, 2013

Polymers
Polyvinyl Chloride

Europe
Some European May PVC contract discussions settled at minus euro35/mt from April, or Eur785-790/mt net, sources said. In April, PVC contracts were assessed at Eur820825/mt net, Platts data showed. Despite the sharp fall in ethylene costs this month, as well as persistently weak European demand, the market was offered some relief from a substantial rise in Turkish demand, sources said. However, some buyers continued to hold out for further discounts from the April contract price of up to Eur50/mt, or Eur770775/mt net, to reflect the decline in feedstock costs, sources said. I have finalized business at minus Eur30-25/mt [from April], but some clients are still waiting for discounts of minus Euro40-50/mt for the remaining month of May. They think that, in June, ethylene will decrease further, a trade source said. Meanwhile, despite a recent uptick in crude oil and naphtha prices, the ethylene market was struggling due to poor derivative demand and limited spot volume uptake, according to industry sources. In the UK, Ineos was accepting discounts of up to GBP30/mt, an increase from GBP20/mt week on week, an Ineos company source said. The company concluded business at GBP690/ mt net, down from Aprils UK settlement of GBP720-725/ mt net, the source confirmed, adding: We have not lost a significant volume at minus GBP30/mt. The market demand is very similar to April. The Ineos company source noted it also gained additional orders throughout March and April due to orders from Kem One customers, and said: There are still question marks over Kem One. We have picked up around 500 tonnes from historical Kem One customers in March and April, and this was really down to uncertainty over Kem One. Kem One was not immediately available to comment at time of press. Overall, European PVC demand remained weak, according to a second trade source, who said some prompt inquiries were due both to upcoming May public holidays and new opportunities to sell into the Turkish market on prompt dates. Demand is not that good, but there are more and more inquiries from European buyers for prompt deliveries. These volumes might be going elsewhere, such as Turkey, or they might be used to cover the holiday period, or a combination of both, the source added. Looking overseas, Turkish demand was rising as local distributor stocks were tightening, according to sources. Buying interest is improving. Import offer prices from all sources have increased by $20-30/mt, one Turkish-based buyer said, adding that Egyptian offers were the sole exception due to lower-quality product. During the past week, offers from Europe into the Turkish market have moved into a range of $1,070-1,120/mt CFR Turkey, up from last weeks range of $1,040-1,080/mt, sources said. In addition, Turkeys leading petrochemical company, Petkim, also raised its domestic polyvinyl chloride [PVC] prices by

$30/mt since last week, because of a substantial boost in demand, industry sources said this week. Petkim was not immediately available to confirm. New prices for polyvinyl chloride were reported at $1,165/mt FCA Aliaga for K67 and K68 grades and at $1,195/mt FCA Aliaga for K58 and K70 grades. Both price indications have risen by $30/mt in the past week, according to market sources. The second trade source said he had not seen this level of demand from the Turkish market since January, adding: The last really strong month was January. From November to January we saw a very hot period in terms of demand, which was dominated by European producers. The Turkish market was oversupplied in that period and they bought more than they needed. Elsewhere, a third trade source said the Turkish PVC market was short in May as European suppliers were biding their time and awaiting more competitive bids, noting: European suppliers are not providing enough cargoes for the Turkish market. Moreover, the rise in Turkish demand provided an outlet for excess European PVC supplies and supported spot prices, the second trade source said, adding: We are more relaxed with our allocations due to the demand in Turkey. Spot prices must have reached a bottom now, at Eur800/mt [FOB Rotterdam], and we think they could move higher again. PVC spot prices have faced downward pressure this month from persistently weak European demand amid falling feedstock costs. The Indian market was also currently seeking supplies from Europe, according to the third trade source, who said: The prices are not as good as the offers into Turkey. We are talking about $980-990/mt CFR India levels. I expect the price to be announced for June shipments to be May plus $20/ mt. India does not import from Europe on a regular basis, but the arbitrage route occasionally makes economic sense due to the anti-dumping duty levied on Asian supplies. Normally, India imports from Taiwan and some other Asian suppliers, but there are anti-dumping duties for these Asian suppliers, so from time to time, they import from Europe, the source added.

United States
US PVC export prices were up $10/mt week on week, assessed Wednesday at $895-905/mt FAS Houston, as several market sources reported that producers and traders are sold out for May shipments. One market source said producer offers for June shipments were at $920/mt FAS Houston basis, however volumes are very limited and evaluated on case by case basis. Sources reported CFR China bids for June shipments at $920/mt, however, selling interest at those levels were described as nonexistent. One June producer to final buyer deal for 2,000 mt was heard at $980-985/mt CFR Turkey with 360-day letter of credit. A trader source said that despite the direct producer deal, CFR Turkey bids below $1,010/mt were not considered. At this point, May is sold out and spot product is difficult to find.

Copyright 2013, McGraw Hill Financial

Platts Polymerscan

May 15, 2013

We are holding our prices higher, the source added. In production, Axiall was expected to start turnarounds at its Plaquemine, Louisiana, PVC and VCM plants by the thirdquarter, according to one source familiar with operations. Plaquemine has a PVC capacity of 750,000 mt/year and a VCM capacity of 728,000 mt/year. Formosas planned turnaround at its Point Comfort, Texas, facility was still slated for June, according to a company source familiar with operations. Point Comfort has a capacity of 695,000 mt/ year of PVC. In feedstocks, US spot chlorine prices gained $5/st week on week, assessed Tuesday at $200-210/st FOB Plant, as production rates declined by four percent to 87% in April, according to a Chlorine Institute report issued to the industry Monday. US spot ethylene jumped 4.25 cents/ lb week on week, assessed Wednesday at 61.50-62 cents/ lb FD USG, as both Flint Hills Resources in Port Arthur, Texas, and Chevron Phillips Chemical Sweeny Complex in Old Ocean, Texas, experienced unrelated power outages on Saturday. Consequently, Chevron Phillips was heard declaring a force majuere on ethylene out of its Sweeny Complex, which was cited as the reason for the 7.75-cent/ lb spike in US spot ethylene prices in the month of May, according to multiple market sources. Chevron Phillips was unavailable to confirm the force majeure. Lastly, May spot ethylene traded Wednesday at 62 cents/lb MtB Wms and 62.375 cents/lb MtB Wms, as June deals were heard at 61 MtB Wms and 61.50 cents/lb MtB Wms.

next week for about 30 days scheduled maintenance, a source close to the company said Wednesday. However an upstream 600,000 mt/year vinyl chloride monomer plant at Kashima will not be shut during the period, a company source said at the end of April. Japans output of PVC fell 15.1% month on month in April to 104,564 mt, and was up 1.7% year on year, Vinyl Environmental Council data released Wednesday showed. April PVC exports fell 8.1% month on month to 25,772 mt, and were up 37.6% year on year. Inventory at end-April stood at 99,747 mt, down 3.9% from March and down 11.4% year on year. In other statistics news, South Koreas PVC exports rose 15.36% month on month to 64,777 mt in April, the countrys Customs and Trade Development Institute said Wednesday, and were up 11.26% year on year. The main destination was India with 32,924 mt.

Latin America
Both Latin American polyvinyl chloride assessments gained $50/mt over the week Wednesday to $1,025/mt CFR Peru and $1,085/mt CFR Brazil as sellers were heard nudging up offers for June-loading in tandem with firming global prices. In the Peruvian market, a May-loading deal was heard at $970/ mt CFR Peru, but the transaction fell outside the assessment window, inclusive of activity done between 20-40 days forward from the publication date. Demand from Peru was described as good and steady, as monthly consumption was consistent, a source said. The source added that prices would likely rise in June because some suppliers were heard offering at least $35-40/mt higher than May on a CFR South America basis (excluding Brazil) or well above $1000/mt CFR South America (excluding Brazil). Previous Peruvian offers for May were heard at $980-990/mt CFR Peru. Peruvian price offer indications for June- loading were heard at $1,060/mt CFR Peru for US-origin material. Freight was heard $10-20/ mt higher at roughly $110/mt because there was tight space availability in vessels, according to a trader. No firm bids or June trades were heard over the week as several sources confirmed they were waiting for fresh June offers from US producers that were expected to be announced next week. In the Brazilian market, material was heard sold from Colombia to Brazil priced in a range of $1,220-$1,240/mt CFR Brazil for May. Offers for May-loading from South Korea were heard at $1,035/mt CFR Brazil before anti-dumping fees and the import tax. Demand remained firm in Brazil amid limited supply, sources agreed. One source said that previously strong sentiment for lower prices in the country will likely change in June. Offer prices for June in Brazil were pegged at $1,100/mt CFR Brazil as a starting point. No firm bids or June trades were heard by time of publication. Many market participants continued to wait for Formosa Taiwan to announce its offer prices for June. In production, Braskem is expected to undergo a 10-day planned turnaround at its Alagoas, Brazil, PVC facility during May, according to the company. However, producer confirmation as to the specific dates of the planned turnaround this month was unavailable by time of publication.

Asia
Asian PVC prices were steady to firm this week as demand was mostly flat amid tight supply. PVC rose $2.50/mt week on week to $957.50/mt CFR China Wednesday, rose $5/ mt to $995/mt CFR India, and was flat at $960/mt CFR Southeast Asia. India last week raised its import duty on a range of polymers including polypropylene, polyethylene and polyvinyl chloride to 7.5% from 5%. This was seen as tightening the domestic Indian market for PVC, as overseas producers were not willing to cut offers to make their product more attractive to the Indian market with the higher duty imposed. Demand was seen as good in India by one major trader, and demand from building material producers seen as robust. In the China domestic market, ethylene-based PVC was seen falling Yuan 120/mt week on week to Yuan 6,850/mt, or around $873/mt on an import parity price, while carbide-based PVC was flat at Yuan 6,520/mt. Domestic PVC was seen as very competitive with imports. Most market players in North and Southeast Asia were waiting for major producer Taiwans Formosa to release its offers for June for market direction, which will likely come next week. Formosa concluded deals for May at $960-970/mt CFR China and a source close to the company anticipated offers for June would be higher. It is an uphill trend, the source said, adding the upswing followed two months of price falls. In addition to an increase in demand from the construction sector, several turnarounds in North Asia are set to tighten available spot supply. Japans ShinEtsu plans to shut its 550,000 mt/year PVC plant in Kashima

Copyright 2013, McGraw Hill Financial

Platts Polymerscan

May 15, 2013

Low Density Polyethylene

Europe
Efforts to replenish restock drove European low density prices higher this week, sources said. However, as macro indicators remained grim, sources attributed the increase in prices to supply-side effects. Producers said inventory overhang had subsided due to measures designed to reduce operating rates and exports. Elsewhere, German chemical output fell 0.5% in the first quarter from the previous quarter due to difficult economic conditions in Europe, the VCI industry federation said in its quarterly report Wednesday. The first quarter of 2013 brought neither the hoped-for turnaround nor any setbacks for the German chemical industry, VCI said. In the spot market, competitive offers dried out the market. You would be lucky to buy any material below Eur1,250/mt FD NWE, a producer said; another producer said: We have an order stop on LDPE. However, converters are willing to pay Eur1,290-1,300/mt FD NWE. Industry data showed that LDPE stocks fell in April. Converters said offers were upward of Eur1,250/mt FD NWE. It is surprising that suddenly prices are higher, while underlying demand is still weak, a converter said, adding: However, a cheaper alternative is not available; a trader said: LDPE melt 0.3 is especially tight; we are selling over Eur1,300/mt FD NWE now. European LDPE spot prices were assessed at Eur1,2501,255/mt FD NWE, gaining Eur70/mt on the week. In the UK market, prices were heard at GBP1,060-1,080/mt FD, also posting gains on the back on snug supplies. European offers to Turkey also gained this week. The market is not as bearish as before, but the level of physical activity has not improved, a Turkish source said. Sources reported an increase of $20/mt in Petkims LDPE list prices to $1,6751,695/mt FCA Aliaga. Middle Eastern offers rose to $1,450/ mt CFR, subject to 6.5% duty. Prices were assessed in Turkey at $1,500-1,505/mt CFR, a jump of $50/mt on the week. In the contract market, producers announced increases of Eur20-50/mt on volumes booked over allocations, citing tight supplies. Contract prices are in the range of Eur1,400/ mt FD NWE. We are offering minus Eur60/mt versus last month. We offered minus Eur80/mt only at the beginning of the month, a producer said; another producer pegged gross prices at Eur1,370/mt FD NWE, adding: A decrease of Eur70/mt is the ceiling for us. Meanwhile, converters were still targeting a monomer decrease of Eur100/mt, with prices in the range of Eur1,330-1,340/mt FD NWE. Enduser demand is not really promising. The turn in the spot market is because stocks were reduced to the lowest possible levels, a converter said. Prices were unchanged this week at Eur1,360-1,365/mt FD NWE; so far, prices have fallen by Eur80/mt. In production news, Borealis 350,000 mt/year LDPE plant in Stenungsund, Sweden, is to undergo planned maintenance for two weeks beginning Friday, a company source said Tuesday. The source pegged utilization rates at the companys polyolefin plants at 84%. Also, SABICs LDPE plant at Wilton, in the UK, is up and running, a company

spokeswoman said, without adding further details. The plant had to restart at the end April following a turnaround beginning early April. The reason of delay was due to technical difficulties, sources said.

United States
Market sources talked of a tighter US low density polyethylene spot market, with multiple trader sources noting that there seemed to be fewer offers for export material this week. LDPE spot prices were assessed Wednesday at $1,422/mt, up $22/mt week on week. A trader source noted that deals were likely at that price, but there were no offers at that level. Another US trader source who exports LDPE to Latin America said there had been an expectation by many buyers in recent weeks that prices would continue to come down for US material, but that has not been the case. I think a lot of them missed out, the source said. Another market source noted that Asian-origin material was still a more attractive option for many buyers in markets that are traditionally targets by US traders. There was limited market activity heard Wednesday, with sources saying that market players were trying to determine how much Chevron Phillips Chemicals force majeure would impact prices. Industry sources said CPChem has been tight on PE inventory in recent months, and that the latest incident at its Sweeny, Texas, facility was the reason for the force majeure. Sources indicated that CPChems move would likely have a smaller impact on the LDPE market because the company is not as big a player in that market. CPChem operates an LDPE units at Cedar Bayou, Texas, and has an estimated annual LDPE capacity of 620 million lbs/ year. While there was growing market talk that producers may have a better chance at implementing their 4 cents/ lb increase for high-density polyethylene, market sentiment was that it would still be difficult for them to get the increase for LDPE. US LDPE domestic contracts were assessed at 83-84 cents/lb FOB Houston ($1,830-1,852/mt), flat from April, after prices rolled over last month. Sources said LDPE seemed to be looser in the domestic market heading into the month. In production news, a report this week by Bank of America Merill Lynch estimated that producer days of inventory had risen two days in April to 34 days, based on three-month trailing demand. The increase was attributed to producers growing inventories ahead of a heavy cracker maintenance schedule in April and May, and weaker domestic demand last month as producers initially tried to implement the 4 cents/lb increase.

Asia
Asian low density polyethylene prices were mixed this week as buyers turned cautious after price hikes the previous two weeks. LDPE was assessed at $1,390/mt CFR Far East in Asia Wednesday, unchanged from last week, and at $1,405/mt CFR Southeast Asia, up $15/mt over the same period. Iranian material was offered at $1,380-1,400/mt CFR China, with a letter of credit of 90 days, according to sources. Meanwhile, a Middle Eastern producer were heard offering at $1,430/

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Platts Polymerscan

May 15, 2013

mt CFR China, L/C 90 days. Market participants said trading dwindled this week as buyers had either already restocked or were waiting for next weeks fresh offers from major Middle Eastern producers. In Southeast Asia, regional cargoes were heard traded between $1,450-1,480/mt CFR. There were still some inquiries especially from those end-users. Regional cargoes are generally preferred because of it prompt arrival, said a regional producer. In South Asia, Middle Eastern producer were heard offering material at $1,440/mt, L/C 90 days. Middle Eastern and Southeast Asia origin cargoes were heard concluded late last week at $1,420/mt CFR India.

Latin America
Low density polyethylene prices for the Peruvian import market decreased $25/mt week on week, assessed at $1,530$1,540/mt CFR Peru amid thin buying interest. South Korean traders were heard selling 100-mt LDPE parcels in a range of $1,545-$1,550/mt CFR Peru. A Thailand-origin offer was heard at $1,545/mt CFR Peru. A higher US-origin offer was heard at $1,587/mt CFR Peru. Expectations regarding the direction of prices were mixed, as there was some indication that prices could decrease, but uncertainty remained, said one Peruvian buyer. In Brazil, the LDPE import market remained flat week on week, assessed Wednesday at $1,520-$1,530 CFR Brazil, amid mixed expectation about price trends. An US-origin offer was heard at $1,540/mt CFR Brazil, for volumes of 100-250 mt. One buyer indicated that he was watching prices for ethylene and propylene to determine the direction of PE prices. The Brazilian LDPE export assessment decreased $25 week on week, assessed at $1,600-$1,610/mt FOT Brazil, as Braskem rolled over its prices month on month on May 8. According to a source with the company, Braskems official May price for the Mercosur region was $1,650/mt on a basis equivalent to an FOT basis, which does not include freight, insurance or other costs. Braskem was heard offering LDPE to Paraguay in a range of $1,710-$1,720 CPT(Carriage Paid to) Paraguay. A source with Braskem indicated that once direction was clearer in the market, customers would act next week.

were low in the chain. We have reached 90% of the order book allocations, 5% over budget, a LLDPE C4 producer said, adding that they were offering decreases of Eur5080/mt on the last month. A decrease of Eur70/mt is the ceiling for us, a LLDPE C6 producer said, pegging prices at Eur1,370-1,400/mt FD NWE. Producers also added they were asking for increases on volumes booked over monthly allocations. Volumes are constrained. Nevertheless, we are targeting the full decline of Eur100/mt of this month to reach a gross price of Eur1,240/mt FD NWE for LLDPE C4 and Eur1,330/mt FD NWE for LLDPE C6, a converter said. Prices were assessed stable this week at Eur1,290-1,295/ mt FD NWE. Despite the start of the summer agricultural season, which had led to a cautious stance, converters reiterated that visibility on orders remained low. In Turkey, Middle Eastern offers were higher at $1,410-1,430/mt CFR, subject to 3% duty. Prices rose $10/mt to $1,420-1,425/ mt CFR on the week. In other news, raw material sourcing issues are becoming a challenge, French and German plastic trade associations, Elipso and Industrievereinigung Kunststoffverpackungen, said in a statement Tuesday. They [European plastic packaging industry] are worried about the degradation of the supply situation within the European Polymer Manufacturing Industry with: too high volatility of prices, too high dependence from the naphtha supply situation and price, aging polymer production tools, too frequent production stops and forces majeures for production breakdowns and emergency maintenances, [and] insufficient investments, which all affect the competitiveness and the quality of the supply of the Plastic Packaging Industry, the statement said. Germany and France represent more than 6.5 million mt of polymer use annually.

United States
The US linear low density polyethylene market was quiet this week as trading sources talked of few offers for export markets. LLDPE spot prices were assessed Wednesday at $1,411/mt FAS Houston, up $22/mt week on week. A trader source who moves product into Latin America noted that deals could be made at that level, but it was difficult to find offers at that level. I think it is a play by producers to prevent price erosion right now, give a perception that demand is strong and material is tight, a US buyer source said. Prices were heard slightly higher in secondary markets. Trader sources said the market was quiet Wednesday as players tried to determine how much impact news of Chevron Phillips Chemicals force majeure for polyethylene products would have on prices. Sources indicated that the impact would be less-felt in film markets than others, particularly the high density polyethylene markets. CPChem shut three steam crackers at its Sweeny olefins complex following a power distribution system failure on Saturday, the company told the Texas Commission on Environmental Quality this week. US domestic contracts were assessed Wednesday at 70-71 cents/lb FOB Houston ($1,543-1,565/mt), flat from April levels after producers

Linear Low Density Polyethylene

Europe
European linear low density polyethylene spot prices continued to strengthen for a second consecutive week on stock replenishment efforts, sources said. Snug LDPE supplies drove LDPE spot prices, which also pulled up LLDPE C4 level, sources added. LLDPE C4 is not spiking like LDPE, but prices are firming, a trader said. A converter noted offers were in the range of Eur1,230-1,250/mt; while a Middle Eastern producer and other trading sources pegged prices at Eur1,200-1,250/mt FD NWE. Prices were assessed at Eur1,200-1,205/mt FD NWE, gaining Eur20/mt on the week. In the contract market, producers said converters were taking more risks for inventory replenishment as prices had reached the bottom of the pricing cycle and stocks

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May 15, 2013

settled at a rollover for the month. US LLDPE producers are attempting to implement a 4 cents/lb increase in May after they were unable to do so last month. While there was market talk Wednesday that producers may have a better shot at implementing the increase for HDPE grades following CPChems force majeure, sources said it was still unlikely producers would be able to raise LLDPE contract prices, citing a looser market. In industry news, information released late last week by the American Chemistry Council showed that PE resin volumes rose 7.2% year on year in April. Domestic demand grew 5.3% and exports increased 15.6% compared to last April. April volumes fell 4.5% month on month, with sources noting that demand was lower as buyers resisted producers attempts to increase domestic contract prices during the month. US spot ethylene jumped 4.25 cents/lb week on week, assessed Wednesday at 61.50-62 cents/lb FD USG, as both Flint Hills Resources in Port Arthur, Texas, as well as Chevron Phillips Sweeny complex in Old Ocean, Texas, experienced unrelated power outages on Saturday. Spot markets have tightened, with US spot ethylene gaining 7.75 cents/lb during May.

Asia
Asian linear low density polyethylene prices firmed this week amid limited offers and restocking activity at the end of last week. Activity was significantly thinner this week than last as market participants preferred to wait for fresh offers from major Middle Eastern producers that are expected to be released next week. LLDPE was assessed Wednesday at $1,375/mt CFR Far East Asia, up $5/mt week on week; at $1,390/mt CFR Southeast Asia, up $10/mt; and at $1,410/mt CFR South Asia, up $10/mt. Most offers were at $1,390-1,400/mt CFR China. A Middle Eastern producer was heard offering at $1,430/mt CFR China, with a letter of credit of 90 days. A Taiwanese producer offered $1,380/ mt FOB Taiwan. Bonded warehouse cargo offers were heard starting from $1,400/mt in China. Buying interest was dampened by a fall in the futures market. Actively traded September LLDPE futures on the Dalian Commodity Exchange fell Yuan 145/mt week on week to Yuan 10,010/ mt Wednesday. In Southeast Asia, activity was heard to be thin as regional supply was tight due to turnarounds. Thailands PTT Global Chemicals shut its 400,000 mt/ year LLDPE plant at Map Ta Phut early May for a 45-day turnaround, Platts reported earlier. In South Asia, Taiwanorigin material was heard offered at $1,425/mt CFR India. Deals were heard concluded at $1,400/mt at the end of last week. Several producers in India were heard raising local prices after the Indian government raised the import duty on a range of polymers including polypropylene, polyethylene and PVC to 7.5% from 5% from May 9.

LLDPE at $1,500/mt CFR Peru for volumes of 100/mt. A second South Korea-origin offer was heard at $1,520/mt CFR Peru for a similar volume. Demand is thin this week. The feeling in the market is that prices can decrease, but we are not sure. So, I am just studying proposals, a Peruvian buyer said. For the Brazilian import market, LLDPE remained flat week on week, assessed at $1,505-$1,515/mt CFR Brazil, amid thin buying interest, sources said. An US-origin offer was heard this week at $1,520/mt CFR Brazil. No firm bids or deals were heard by close of assessment. The Brazilian LLDPE export assessment for Mercosur countries decreased $10, assessed at $1,595-$1,605/mt FOT Brazil, amid thin market activity. A Brazil-origin LLDPE offer was heard at $1,710 CPT (Carriage Paid to) Paraguay and a second offer from Brazil to Paraguay was heard at $1,730 CPT basis. According to a source with the company, Braskems official price in May rolled for the Mercosur region and remained at $1,650/mt on a basis equivalent to an FOT basis, which does not include freight, insurance or other costs. In using CPT offers to assess FOT basis prices, Platts estimates freight costs at around $100-$120/mt, based on customer feedback. Outside the Mercosur region, Braskem was heard offering LLDPE in a range of $1,540-1,590/mt CFR Chile. Customers will act next week, once there is a firmer price trend, a source with Braskem said. The demand is there, but we are having mixed sentiment in the market regarding the trend of prices. Some believe that we arrived at the floor price, others still see room for further decreases.

High-Density Polyethylene

Europe
Profitability remained a concern for European HDPE producers as a further closure was announced, sources said. LyondellBasell will shut down a high density polyethylene unit in Wesseling, Germany, in the third quarter of 2013, the company said in a statement Wednesday. The 100,000 mt/year unit is among the smallest and least efficient of the LyondellBasell HDPE units in Europe, the company added. LyondellBasell has three other HDPE plants at the site, and the company added it had sufficient HDPE capacity to meet customer needs from its larger scale facilities. The closure of under-competitive assets, along with the restructuring and efficiency-improvement initiatives in our business areas, manufacturing and R&D, will better position LyondellBasell to compete in todays economic environment, the company said. In the contract market, producers said injection demand had picked up, leading them to revise targets from minus Eur80/mt to minus Eur60-70/mt. There is a shortage of melt 4 and melt 8 in the market, a producer said, adding that blowmolding and film remained relatively weaker and they were conceding decreases of Eur70-80/mt on the end of April. After months of very low demand, we are finally seeing a rebounding, driven by restocking effect. We were chasing orders last month; it is the opposite now, a producer said. Sources said restocking was led by increase

Latin America
Assessments for the Peruvian linear low-density polyethylene import market fell $15 week on week, assessed Wednesday at $1,490-$1,500/mt CFR Peru, pushed down by lower Asian offers. South Korean sellers were heard offering

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May 15, 2013

in Asian prices and stability in feedstock prices. Meanwhile, despite grim macroeconomic indicators, converters remained cautious on demand as they hopied to achieve the ethylene decline of Eur100/mt. Elsewhere, the ecession deepened across the eurozone during the first quarter of 2013 as the latest growth figures released by the EU Wednesday showed a 0.2% contraction between January and March. Gross prices shed Eur80/mt in the month, but held steady this week. In the spot market, sources said injection prices rallied in the face of stock replenishment, limited imports and snug European supplies. Two converters reported offers at Eur1,250/mt FD NWE; other offers were heard in a range of Eur1,200-1,270/mt FD NWE. Meanwhile, sources said blowmolding and uni-modal film prices remained below Eur1,200/mt FD NWE as supply tightness was not prominent in both markets. Bi-modal film offers were heard in a range of Eur1,200-1,270/mt FD NWE. Spot prices were assessed Eur25/mt higher for injection at Eur1,225-1,230/mt FD NWE, while blowmolding and film prices were assessed unchanged at Eur1,180-1,185/mt FD NWE. In Turkey this week, local producer Petkim increased prices by $20/mt to $1,620-1,645/mt FCA Aliaga, sources said. Offers from Europe and the Middle East to Turkey increased. Central European offers were heard at Eur1,190-1,210/mt CFR, while Middle Eastern offers were heard at $1,450/mt CFR. The market is not as bearish as before, but the level of physical activity has not improved, a Turkish source said.

Africa
Compared to the past two weeks of laggard demand, sources said there had been an uptick in sentiment, although buying remained cautious. One Middle Eastern producer said LDPE and LLDPE price offers were at $1,480/mt CFR for North Africa. European offers shot up to $1,600/mt CFR for LDPE, making them uncompetitive, according to sources. In Egypt, LDPE, LLDPE and HDPE offers were heard at $1,450/mt CFR. My feeling is not too optimistic, even though global prices have picked up, an Egyptian trader said. In Algeria, a pickup in demand for HDPE film was noted by one source, who observed: Offers are higher, but it is not leading to a pickup in buying. Offers for LDPE were heard at $1,450/mt CFR and LLDPE at $1,520/mt CFR from Asia in West Africa, while HDPE offers were heard at $1,450-1,500/mt CFR.

at its Sweeny facility was the reason for the force majeure. Spot prices were talked higher Wednesday, though market sources reported no confirmed deals as buyers and sellers tried to determine where the market would settle. Sources talked of offers as high as 65 cents/lb FOB Houston for blowmolding, while bids were heard as low as 59 cents/lb. Multiple sources pegged the blowmolding market at around 62 cents/lb FOB Houston, and noted that other grades would rise by similar amounts. The domestic market is up 4 cents since Monday, one US trader source said. Spot HDPE blowmolding was assessed Wednesday at $1,411/mt FAS Houston, up $72/mt week on week. HDPE injectiongrade prices were assessed Wednesday at $1,455/mt FAS Houston, up $77/mt week on week. High-molecular weight film was assessed at $1,477/mt FAS Houston, up $77/mt week on week. Sources said Formosa Plastics force majeure for HMW Film products putting even more pressure on an already tight film market. The company said Wednesday that two of the three production lines at its polyethylene No. 1 production unit up to full capacity, and it estimates that the third line will start up in late June. The PE unit has returned to approximately 70% capacity, the company said. The quantity of product that will be allocated for the month of June is under evaluation, according to Formosa. US domestic PE contracts were assessed Wednesday at 72-73 cents/lb FOB Houston ($1,587-1,609/mt) for HDPE blowmolding and 72-73 cents/lb FOB Houston ($1,5871,609/mt) for HDPE injection. HDPE film contracts were assessed at 75-76 cents/lb FOB Houston ($1,653-1,675/ mt). Market talk in recent weeks has been that producers would be pressed to implement the 4 cents/lb increase that was delayed from April, and if anything, a decrease could be warranted. But Wednesday, several buyer sources said new developments made it increasingly possible that the producers could implement a May increase.

Asia
Asian high density polyethylene prices continued to rise for a third consecutive week on the back of restocking activity and limited supply. However, activity was significantly thinner this week than last as market participants stuck to the sidelines and waited for fresh offers from major Middle Eastern producers expected next week. HDPE-film was assessed Wednesday at $1,420/mt CFR Far East Asia, up $15/mt week on week; at $1,430/mt CFR Southeast Asia, up $10/mt; and at $1,440/mt CFR South Asia, up $15/mt. Offers were heard at $1,430/mt CFR China, letter of credit at sight. A deal for a small quantity of prompt-arrival cargo was heard concluded at the offer price. However, buying interest for deepsea cargoes at the same price was thin. The situation will be clearer next week with the producers announcing June offers. Since most of the people are still in search for a direction, if they need to restock, they will prefer prompt cargoes, a Japanese trader said. In Southeast Asia, buying sentiment was improving, sources said, but offers were limited. Thai material was offered to Indonesia at around $1,520/mt CFR, and it traded at $1,500-1,510/

United States
US high density polyethylene market players were trying to determine the impact of Tuesdays announced force majeure by Chevron Phillips Chemical, with talk of spot prices that had risen several cents/lb this week and stronger potential for producers to implement a 4 cents/lb increase for May domestic contracts. CPChem declared a force majeure for its polyethylene products Tuesday, according to a letter to customers that was obtained by Platts. The company said in the letter that the move was caused by issues affecting its ethylene production, causing a contingency event. Industry sources said CPChem has been tight on PE inventory in recent months, and that the latest incident

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May 15, 2013

mt CFR Indonesia, source said. Meanwhile, regional cargoes were heard concluded at $1,480-1,490/mt CFR Southeast Asia. There is no urgency from buyers as prices have gone up quite a bit over the past few weeks. They will wait for new offers next week before taking any position, said a regional trader. In India, several local producers were heard raising local prices by a couple of rupees for each kilogram of resin after the India government raised the import duty on a range of major polymer namely polypropylene, polyethylene and PVC to 7.5% from 5%, effective May 9. Offers were heard at $1,450/mt CFR India this week with thin buying interest from the market as imported material lost some of its appeal after the tax increase. In addition, market participants prefer hold purchases for next week when major producers announced June offers.

amid thin market activity. HDPE blowmolding decreased sharply, down $50/mt FOT basis to an assessment of $1,535$1,545/mt. Braskems official May HDPE prices for export to the Mercosur region on an equivalent basis were at $1,700/ mt. Offers from Brazil were heard in a range of $1,650$1,660/mt CPT (Carriage Paid to) Paraguay. Platts FOT assessments do not include freight, insurance or other costs. HDPE injection decreased $30/mt, assessed Wednesday at $1,580-$1,590/mt FOT Brazil. Braskem was heard offering injection grade at $1,700/mt CPT Paraguay. HDPE Film decreased $10/mt, assessed at $1,605-1,615/mt FOT Brazil. Offers from Brazil were heard in a range of $1,720- $1,730/ mt CPT Paraguay. Outside the Mercosur region, Braskem was heard offering blowmolding in a range of $1,560-$1,590/mt CFR Chile.

Latin America
High-density polyethylene assessments for the Peruvian import market were mixed this week, amid a thinly traded market and weak demand, sources said. Peruvian HDPE injection decreased sharply by $40/mt to an assessment of $1,485-$1,495/mt CFR Peru. Two offers, one from the US and the other from South Korea, were heard at $1,500/mt CFR Peru. No deals were heard in the market for the week. We are still studying some offers because the market is very unclear, a Peruvian buyer said. The demand is low because the import and export markets in Peru are both quite weak. I am waiting until the middle of next week to decide whether to purchase material. HDPE film was assessed Wednesday at $1,525-$1,535/mt CFR Peru, a $20/mt increase week on week. South Korean sellers were heard offering film in a range of $1,540-$1,550/mt CFR basis. A Thailand-origin offer was heard at $1,585/mt CFR Peru. HDPE blowmolding decreased $15/mt, assessed at $1,465-$1,475/mt CFR Peru. Offers from the US were heard at $1,500/mt CFR basis, while a South Korean-origin offer was heard lower, at $1,480/mt CFR Peru. It is getting cold in Peru, so certain grades such as blowmolding are not in high demand right now, the Peruvian buyer said. HDPE assessments for the Brazilian import market were also mixed this week, in a thinly traded market, sources said. HDPE film climbed $10/mt week on week, assessed Wednesday at $1,500-$1,510/mt CFR Brazil. One US offer was heard at $1,520/mt CFR Brazil. The sellers are no longer accepting counter offers or firm bids. They are insisting on their prices, a Brazilian buyer said. As in Peru, Brazilian blowmolding grade moved down $10/mt week on week to an assessment of $1,465-$1,475/mt CFR Brazil. US sellers were heard offering blowmolding at $1,480/mt CFR Brazil, but no bids or deals were heard in the market. Injection grade remained unchanged, assessed at $1,495$1,505/mt, as no offers were heard this week. However, market participants talked notional prices at the same level as blowmolding, around $1,480/mt CFR Brazil, but no firm pricing was available. Now, I am watching how much propylene and ethylene cost. Their prices will indicate what is going to happen with PP and PE, a second buyer said. FOT Brazil export assessments moved lower week on week,

Polypropylene

Europe
European spot polypropylene prices posted a marginal recovery during the week, to be assessed at Eur1,130-1,135/ mt FD NWE, as inventory replenishment efforts led to firmer selling interest. The recovery seen in the upstream energy complex instilled some confidence in polymer buying this month, trading sources said, citing keener interest for May and June volumes. There is more confidence in the market, prices have bottomed out, a trader said. Trading and distribution sources were trialling higher offers this week as levels of Eur1,160-1,180/mt FD NWE were heard tested. Although underlying demand remained inherently weak as converters continued to report low volumes from end-user markets, low inventory levels throughout the value chain encouraged some stock rebuilding efforts, according to sources. However, the fragile recovery had not been noted in the feedstock propylene market as spot prices there remained firmly below the May contract price of Eur1,025/mt FD NWE. Given some cautious optimism in the polypropylene market this week, producers appeared more content with their stock levels. In addition, as export outlets continued to be actively pursued and plant operational rates remained reduced, monthly domestic volumes posted an improvement. In polypropylene, the order intake is good, but we do not need to take any preventive measures to stop the pre-buying, like in polyethylene...we are following our volume forecasts and are still passing the full propylene decrease, a producer said. In turn, some producers who had been buoyed by manifest stock rebuilding efforts firmed their negotiation positions. Buying interest has picked up. There is some reasonable resurgence; it is stock rebuilding, definitely not pre-buying, a second producer said, adding: We are firming our position and offer a reduction of Eur65-70/mt [in May pricing.] Meanwhile, converters noted that although there was less push for volume from some producers, others remained volume driven. There is still some push to get volumes, and those producers do incentivize with [attractive] pricing, a converter said,

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adding: I am not finding great demand. I do not want to commit to masses of volumes as I am not sure that June will be different. In downstream news, BOPP volumes subsided this week due to some inventory length in that segment, sources said. The highest volume nominations for May came from consumer and rigid packaging segments, while specialty applications, such as battery casing and pipes, continued to lag behind. Industrial applications remained weak, while automotive, non-woven, pet food and pharmaceuticals remained stable and at healthy levels. The automotive segment is performing better than expected, a producer said. Meanwhile, in Turkey, buyers stepped back into the market. There are more inquiries than last week...market sentiment is positive due to higher feedstock costs, firmer China and lower inventories, a Turkish trader said. Overall, traders were raising offers in response to keener buying interest. The local producer Petkim was heard to have raised its domestic prices by $20/ mt, although immediate confirmation from the company was not obtained at time of press. Spot values in Turkey strengthened to $1,470-1,475/mt CFR Istanbul.

Africa
Despite the modest recovery observed in other regions, the North African polypropylene market lacked buoyancy. The widespread inventory rebuilding efforts seen in European and Turkish markets had not emerged in North Africa, sources said. The demand is still weak...I am not too optimistic, even though global prices are getting higher, a trader said; a second trader added: There is nothing exciting in North Africa this week. It is stable, with people looking around for June [offers] now; prices are only slightly up. Traders said all eyes were now on Asia, where prices posted a recovery. Although a similar trend was expected to filter through to North Africa, firmer fundamentals were yet to resurface, according to sources. Despite persistently bearish fundamentals, transactions were reported at higher levels this week. Spot values for homo injection grade strengthened to $1,465-1,470/mt CFR North Africa. In West Africa, everyone has pulled up the offers, looking at Asia, a third trader said. Elsewhere, European spot polypropylene prices posted a marginal recovery during the week, to be assessed at Eur1,130-1,135/mt FD NWE, as inventory replenishment efforts led to firmer selling interest. The recovery seen in the upstream energy complex instilled confidence in polymer buying this month, trading sources said, citing keener interest for May and June volumes.

sources said. Domestic contract prices for May had yet to materialize, as feedstock PGP remained unsettled, with some producers willing to drop prices by 1 cent/lb ($22/mt), while at least two were fighting for a rollover at 63 cents/ lb ($1,389/mt) delivered. Recent production issues at two US Gulf Coast steam crackers with significant propylene production were providing spot PGP pricing support. I think the PP market has hit a bottom, a US-based trader said. Domestic contracts last settled for April down 10 cents/ lb at 72-73 cents/lb ($1,587-1,609/mt) delivered railcar for homopolymer injection. With demand on the rise, it was unclear how much longer US-origin PP could compete into South America, one trader said. I received a PP raffia offer from a producer this morning at slightly over $0.70/lb bulk, the trader said Wednesday. I think that is still a bit aggressive, but the trend is up. Last week, other traders said FAS Houston generic prime homopolymer material could be had at 66-68 cents/lb ($1,455-1,499/mt) FAS Houston basis. DAT Laredo homopolymer was heard bought recently at 69 cents/lb ($1,521/mt) bagged. Another US-based source said he had a trader selling homopolymer injection at 67.5 cents/ lb ($1,488/mt) in bags. Sources in Brazil said US material was being offered at $1,540-1,560/mt CFR basis for volumes ranging from 45-300 mt, although some US-based traders said some of the lower sales prices seen out of the US were for wide-spec material, something that could not be confirmed by time of publication. The FAS Houston assessment rose $33/ mt week on week to $1,455-1,477/mt, with market sources in agreement that prices were on the uptrend given increased domestic demand and stronger prices from other regions into South America, including Asia.

Asia
Asian polypropylene prices were stable this week in China but rose in other regions on limited spot availability. The PP raffia and injection markers were both assessed at $1,389/mt CFR Far East Asia Wednesday, down $1/mt and up $4/mt, respectively, week on week. The PP raffia/injection markers rose $20/mt week on week to $1,440/mt CFR Southeast Asia and gained $15/mt to $1,435/mt CFR South Asia over the same period. Offers for end May/early June arrival cargoes were at $1,400/mt CFR China late last week, with trades concluded at $1,390-1,400/mt CFR China. However, trading sentiment softened early this week as end-users completed restocking activity and had less buying appetite. Offers were at $1,390-1,420/mt CFR China, while bids were at $1,380-1,390/mt CFR China. There is not much change, but sentiments softened. It is harder to conclude deals at $1,400/mt CFR China, a producer said. Injection grade was heard to be at the same price as raffia grade. In Southeast Asia, prices rose on limited spot availability. Major producers have yet to offer June arrival cargoes but indicated they have lesser volume in June due to maintenance. Thai Polypropylene Co. plans to shut its 400,000 mt/year PP plant in Map Ta Phut in June for maintenance, a source close to the company said. The plant is expected to be shut for 10 days, but the dates have yet to be fixed, the source

United States
Domestic demand was heating up as buyers continued to rebuild inventories and the prospect of a nominal decrease in contracts for May, sources said this week. Demand is absolutely here, a source with a major distributor said. It is real. Sellers were expecting strong sales through June, with one producer source saying his company was sold out though July. The spike in demand began in earnest in April when contracts fell 10 cents/lb ($220/mt),

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said. The production loss is estimated at 10,959 mt. TPP is a wholly owned subsidiary of SCG Chemicals, which is a subsidiary of the Siam Cement Group. Thai-origin cargoes arriving in June were traded at $1,520-1,530/mt CFR Philippines, while similar cargoes were traded at $1,5301,540/mt CFR Indonesia. ASEAN-origin cargoes do not attract import taxes of 5-10% under a free trade agreement. A major Indian producer traded June-loading cargoes at $1,450/mt CFR SEA. In Vietnam, offers were at $1,4701,480/mt CFR, while bids were at $1,420-1,430/mt CFR. In South Asia, offers were at $1,450/mt CFR India, but few bids were heard. Converters were waiting for fresh offers from Middle East producers, expected to be released next week. Buyers were also rushing for domestic material as some local producers have yet to adjust their local prices in line with the higher import duty. The government raised the tax on a range of major polymers namely PP, polyethylene and PVC to 7.5% from 5%, effective May 9. In Pakistan, Indian-origin cargoes were traded at $1,460/mt CFR, while offers were at $1,470/mt CFR. Block copolymer prices increased $5/mt week on week in Far East Asia to $1,415/ mt CFR Wednesday, rose $20/mt in the same period to $1,460/mt CFR Southeast Asia, and rose $25/mt at $1,470/ mt CFR South Asia. In China, discussions were at $1,4001,450/mt CFR. In Southeast Asia, Thai cargoes were traded at $1,530/mt CFR. In India, offers were at $1,480-1,490/mt CFR, with limited cargoes available. Feedstock propylene was assessed at $1,260/mt FOB Korea and $1,330/mt CFR China Wednesday, both up $15/mt week on week. In statistics news, South Koreas PP homo-polymer exports rose 7.5% month on month to 98,488 mt in April, and co-polymer exports increased 3.6% to 117,060 mt in the same period, data released Wednesday by Korea Customs Services showed.

Latin America
Assessments for the Peruvian co-polymer import market rose $10/mt week on week, pressured higher by offers from Brazil. Co-polymer was assessed at $1,555-$1,565/mt CFR Peru. Brazil-based Braskem was heard offering co-polymer at $1,570/mt CFR basis. A higher South Korean offer was heard at $1,640/mt CFR basis. Colombia-origin offers were absent from the market, sources said. This week Colombia is on a holiday, so I did not have information from Propilco, a buyer said. Peruvian homopolymer assessments remained flat week on week, assessed at $1,515-$1,525/mt CFR Peru in a thinly traded markets. Two offers from South Korea were heard at the same price, $1,570/mt CFR basis, for volumes of 100 mt. A lower one, from Brazil, was heard at $1,530/mt CFR Peru, for a similar volume. These import levels could be under pressure from rising prices in Asia, which offers a significant amount of product into the West Coast of South America. In Brazil, co-polymer remained flat amid thin market activity, assessed at $1,545-$1,555/ mt CFR basis. No offers were heard for material to be delivered 20-40 from date of publication. Saudi Arabia-origin material was heard at $1,570 mt CFR basis for delivery in 50 days. But I am bidding $1,550/mt, a Brazilian trader

said. Because of its delivery time, the offer was not used in the assessment because its delivery time did not meet Platts methodology standards. Brazilian homopolymer also remained unchanged, assessed at $1,520-$1,530/mt CFR basis. Multiple offers for US-origin homopolymer material were heard at $1,540-1,560/mt CFR Brazil for volumes of 100-250 mt and delivery by H1 June. A Saudi Arabiaorigin offer was heard at $1,530/mt CFR Brazil for delivery in 50 days, with the trader bidding $1,510/mt CFR basis. This parcels delivery date fell outside Platts methodology standards. For the Brazilian export market to Mercosur countries, polypropylene grades remained flat week on week amid low buying interest within the region, according to sources. Homopolymer was assessed at $1,600-$1,610/ mt FOT basis, while co-polymer was at $1,625-$1,635/mt FOT basis, as last week Braskem decreased its official offers to Mercosur by $20/mt, according to a company source. Platts FOT assessments do not include freight, insurance or other costs associated with transit. Customers will act next week, seeking to have a firmer grip on the price trend. The demand is there, but we are having mixed sentiment in the market regarding the trend of prices, a source with Braskem said. Some believe that we arrived at the floor price; others still see room for a small decrease. Braskem was heard offering homopolymer at $1,720/mt CPT (Carriage Paid to) Paraguay, while co-polymer offers were heard at $1,750/mt CPT Paraguay. Outside the Mercosur region, Braskem was heard offering material at lower prices to West Coast South America. Braskem was heard offering homopolymer in a range of $ 1,560-$1,600/mt CFR Chile and at $1,530/mt CFR Peru. Brazilian-origin co-polymer was heard at $1,570/mt CFR Peru. Due to our geographic location, Asian countries often offer products to us at lower prices, which pressures Brazil to be more competitive, a Peruvian buyer said.

Polystyrene

Europe
Northwest European polystyrene contract prices registered losses of Eur5/mt to close the session at Eur1,570/mt FD NWE for general purpose grade product and Eur1,670/ mt for high impact grade. Market sentiment was less upbeat this week as more settlements were reported concluded at a decrease of Eur10/mt to a rollover from April. In feedstock developments, styrene monomer spot prices rallied $75/mt, or 4.7%, week on week to close sharply higher at $1,680/mt FOB ARA Wednesday. Since the beginning of May, values have surged $114.50/mt, or 7.3%, on the back of tightened supplies as regional producers, such as Styron and Total, ran their facilities at reduced rates to purchase styrene from the spot market, either out of circumstantial neccessity or economics. If the current price trend persisted, market participants could expect a significant increase in costs and PS prices in June, which, in relation to current May prices, could incentivize convertors and end-users to build more inventory this

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month, sources said. If prices are significantly down, I would purchase and build stock, but they are still too high, a convertor said, adding: So for the time being, there is no reason to buy. It is the contrary with PP, I buy massively right now. This sentiment was echoed by producers, who saw a reduction in sales volumes due to demand destruction from high outright prices on PS. Sales volumes are so far lower by 2% than in April. Several convertors are reluctant to order due to the fact that in the past two months, polyolefins decreased in price significantly, while PS did not do so much, a producer said. However, light demand was balanced out by fairly taut supplies, sources said, as the PS industry maintained utilization rates at 95% and amid fresh cuts in production. Total Petrochemicals cracker at Gonfreville in northwest France remained shut following an unsuccessful restart last week, a company source said Monday. The cracker was unexpectedly shut at the end of April following an unspecified production issue and all interconnected units that receive feedstock from the cracker were shut at the same time. They had an issue over the weekend again and it is not solved, the source said, adding: The issue is not fully determined, so there is no official schedule [for another restart]. Due to the cracker outage, Total has been running its 650,000 mt/year styrene monomer plant at Gonfreville at reduced rates, the source said, declining to provide details on the units exact operating rates. Market participants said that, in turn, production at its Carling PS units could have also been impacted. Total did not comment. Expandable polystyrene prices slipped Eur5/mt on the week, to close at Eur1,600/mt FD NWE, as settlements were done at a rollover to decrease of Eur10/ mt April, allowing producers some margin recovery in May. Demand was largely firmer during the month and regional producers raised operating rates in preparation for higher volumes in June. We are running at nearly 100%. My personal feeling is that customers have low inventories, but on our side, we have regular stocks, a producer said. Downstream, convertors were also estimated to be running higher in May at around 80-90% capacity. In production news, Austrian expandable polystyrene producer Sunpor Gesellschaft ramped up operations at its Radleberg plant to 100% of capacity, a company source said Tuesday. The 100,000 mt/year EPS plant was brought back online in early April following a period of scheduled maintenance and has since operated at reduced rates. Increased rates in May were attributed to improved demand and expectations they would rise further into the month and in June, the source said, adding: Structurally speaking, I am optimistic. Meanwhile, expansion work at the unit has also been completed. The unit underwent a debottlenecking procedure to boost its capacity by 30,000 mt/year. Trial runs on the expanded capacity were completed at the end of April, the source said, but no decision had been made on commercial operations. Sunpor also owns a 80,000 mt/year EPS plant at Polten, but this was still running reduced as of Tuesday.

Africa
North African polystyrene values surged considerably in the third week of May amid rising offers from Asia, which had been the regions outlet for cheaper alternative sources of supply. Prices were assessed $50/mt higher, at $1,910/mt CFR North Africa for general purpose grade product and $2,015/ mt CFR for high impact grade material. According to local distributors and market sources, Asian sellers raised offers for GPPS to $2,000/mt CFR North Africa and $2,100/mt CFR for HIPS. No trades transpired at those levels, while European suppliers proved to be the more competitive sellers in May. In line with the reduction in styrene feedstock costs, Northwest European producers decreased May offers to the region by Eur20-25/mt, producers said, declining to provide outright values. North African sources said they received offers for European product at around $1,980/mt CFR for GPPS and $2,080-2,100/mt CFR for HIPS. The trades that transpired at those levels were scarce, casting doubts over whether those traded values were repeatable. Despite the price increase, the overall fundamental situation was little changed, sources said. Demand remained weak amid poor weather conditions and weak sentiment. Buyers buy only what they need for one to two weeks maximum; demand is so weak and they just deal that, a source said, adding:. They monitor their supply according to demand. Expectations of higher demand in June were generally held in consensus by market participants. Meanwhile, in Asia, GPPS prices were assessed unchanged at $1,780/mt CFR China.

United States
US domestic prices for general-purpose polystyrene and high-impact polystyrene for May continued to be negotiated this week after 2-4 cents/lb increases were announced by producers effective May 1. Sources said no settlement had been reached for May. Total Petrochemicals implemented a 2 cents/lb ($44/mt) increase on all grades of polystyrene for May, with another 2 cents/lb increase, effective June 1, according to a letter sent to customers. Styrolution and Americas Styrenics both implemented 4 cents/lb increases for May, according to separate letters sent to customers. Buyers were said to be pushing back hard on the increases. They dont have a reason to be up 4 cents, one source said. Americas Styrenics cited higher seasonal demand and low inventories as well as recent changes in feedstock, operating and logistical costs for the increase in its letter, while Styrolution cited feedstock costs in its letter. Sources said an increase of 2 cents in May and another 2-cent increase in June could happen. There is still some people pushing the 4 cents, but nobody in the secondary market is doing 4 cents and doing 2 cents instead, the source said. Domestic polystyrene was assessed flat on the week at 107 cents/lb delivered rail car for GPPS and 118 cents/lb delivered rail car for HIPS Wednesday. Demand in the market was steady to strong, sources said, adding that part of the reason for the rise in demand was because of the price increases and some pre-buying before the price increases are fully implemented. Sources also cited higher seasonal demand from converters

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for the increase. Supply was described as tightening in the market, but sources said there were no production issues this week. In the export market, GPPS was assessed at $1,895/ mt FAS Houston, while HIPS was assessed at $2,025/mt FAS Houston on Wednesday. Offers to Peru from Korea were heard at $1,880/mt CFR for GPPS and $1,980/mt CFR for HIPS this week. US offers to Peru were heard slightly higher at $1,900/mt CFR for GPPS and $2,030/mt CFR this week. In feedstocks, styrene was assessed 1.50 cents higher on the week at 72.50 cents/lb FOB USG Wednesday on tighter supply. Demand in the styrene market has increased because of open arbitrage windows to Europe and Asia, sources said, but there is little to no supply available for May and June. Styrene feedstock benzene was assessed 1 cent higher on the week at 442 cents/gal FOB USG.

said South Korean producers were now likely to raise their offers above $1,900/mt FOB Korea due to higher feedstock prices. Meanwhile, South Koreas April exports of EPS increased 18.6% month on month to 17,275 mt, jumping 27.7% from the year before, customs data showed.

Acrylonitrile Butadiene Styrene

Europe
The Northwest European acrylonitrile-butadiene-styrene benchmark continued to fall in the third week of May, registering a week-on-week decline of Eur20/mt to close at Eur1,915/mt FD NWE. Broadly, settlements were concluded at a decrease of Eur20-40/mt from April, producers said, seen at outright values of between Eur1,900-1,940/mt FD NWE for GP/natural grade material. Trade and market sentiment was largely quiet during the week, partly due to regional holidays, but fundamentally because demand remained in the doldrums. May has been weaker than April, related mainly to the bank holidays in Europe. It is disappointing, a producer said. Apart from the obvious weakness in automotive, there was little improvement in the extrusion or injection-molding, appliances and white goods sectors. On the whole, industry operating rates were estimated to be hovering at around 70-75% capacity. In feedstock developments, styrene monomer spot prices rallied $75/mt, or 4.7%, week on week to close sharply higher at $1,680/mt FOB ARA Wednesday. Since the beginning of May, values have surged $114.50/mt, or 7.3%, on the back of tightened supplies as regional producers, such as Styron and Total, ran their facilities at reduced rates to purchase styrene from the spot market, either out of circumstantial necessity or economics. If the current price trend persisted, market participants could expect a significant increase in both costs and PS prices in June, which, in relation to current May prices, could incentivize convertors and endusers to build more inventory this month, sources said. In April, we saw massive de-stocking, and we tried to counter it by incentivizing spot deals, but there was nothing that could make them buy, a producer said, adding: Now all the de-stocking is done and there are low stocks through the chain. By the end of May, we may see things go back to normal, especially if the market becomes convinced of higher prices coming. Meanwhile, sellers added that most convertors had stronger cash flow positions and the liquidity pressures that had been previously felt were no longer as pronounced, although purchases remained on a hand-tomouth basis due to the overall lack of confidence in the market. What we see is customers buying what they need. That could change if the situation of raw materials changes; that might also change demand, a source said, adding: We have seen that in Asia demand is improving a little bit, too. In the East, CFR China prices ticked up $20/mt, to close at $1,893/mt, as producers struggled to recover margins. However, Asian suppliers were still offering to Europe at around Eur1,700-1,750/mt CFR NWE for GP/natural grade

Asia
GPPS: Asian general purpose polystyrene was assessed unchanged week on week at $1,780/mt CFR China despite a relatively sharp rise in feedstock prices as offers for GPPS were heard flat to slightly firmer on a CFR China basis. Week on week, styrene monomer increased $28/mt to $1,689.50/mt CFR China, assessed on Wednesday. Taiwanese producer Chi Mei was heard inching up its offer by $10/mt last Thursday to $1,800/mt, while the retail price of Chi Meis material in Hong Kong was around $1,820/mt, sources said. However, other offers were heard at lower levels, and a producer based in Hong Kong was offering at $1,780/mt ex-factory this week. The producer said it was difficult to sell larger quantities of GPPS even at $1,780/mt at the moment. In Southeast Asia, a producer had raised its offer $20/mt from last week to $1,850/ mt CFR Southeast Asia, but said Taiwanese producers were selling their product to the region at $1,820-1,830/mt CFR Southeast Asia, up from a price below $1,800/mt the week before. Demand in Southeast Asia was increasing ahead of the Islamic holiday of Eid al-Fitr, which is celebrated in countries such as Indonesia and Malaysia in August, the producer noted. HIPS: High-impact polystyrene prices were assessed higher by $5/mt week on week to $1,860/mt CFR China and $1,920/mt CFR Southeast Asia following an increase of $20/mt week on week in the price of acrylonitrile-butadiene-styrene to $1,893/ mt CFR China. Offers for June shipment cargoes of HIPS were heard from $1,860/mt CFR China upwards to $1,900/mt CFR China this week. The retail price of HIPS in the trading hub of Hong Kong was, however, no higher than $1,860-1,870/mt, trade sources said. In related news, South Koreas April exports of HIPS rose 6.8% from March to 28,801 mt, and was up 28.7% year on year, data released Wednesday by Korea Customs Services showed. EPS: Expandable polystyrene was assessed up week on week by $10/mt to $1,820/mt for general purpose and up $16/mt to $1,895/mt for flame retardant, both FOB Northeast Asia. Producers in China were raising their offers this week and one major producer said it had sold general purpose at $1,820/mt FOB China, the lowest price heard in the market. The same producer was offering flame retardant at $1,900/ mt FOB China, but deals were heard done recently on an FOB Korea basis around $1,880-1,890/mt. However, a trade source

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and at around Eur1,800-1,900/mt for coloreds, according to market sources. In production news, Styron Europe will shut one of three trains at its ABS plant at Terneuzen, in the Netherlands, for scheduled maintenance next week, a company source said Tuesday. No details were available regarding that particular trains capacity, but that line at the 210,000 mt/year ABS plant will be shut for a month. Styron had previously been running the plant at reduced rates on the back of poorer-than-expected demand. We have built stocks as this has been planned for a long time, the source said, adding: It is a mandatory shutdown and it should not have an impact on the market. Meanwhile, Styron shut its 500,000 mt/year styrene plant at Terneuzen at the beginning of May on poor economics. The companys ABS operations were unaffected by the shutdown, the source said.

price. The producer noted that at this price level, ABS was not making money. Looking at costs, key feedstock styrene monomer prices rose $28/mt week on week to $1,689.50/mt CFR China Wednesday, while butadiene was unchanged over the same period at $1,485/mt CFR China. Acrylonitrile shed $15/mt week on week to $1,705/mt CFR Far East Asia, assessed Tuesday. Based on those prices and a conversion cost estimated at around $250/mt, the breakeven cost of ABS should be around $1,912.50/mt, up $10.70/mt from the week before. One Northeast Asian producer said the company had lost around $100/mt for ABS sold in April, and added that most other Asian producers would be struggling with similar losses.

Polyethylene Terephthalate

United States
The US acrylonitrile-butadiene-styrene assessment was stable on the week at 123 cents/lb delivered rail car Wednesday as the market monitored feedstocks. ABS prices were talked in the low 120s cents/lb delivered this week. Demand in the market was heard steady to strong, while supply was available. Sources said US ABS prices could be bottoming out and rise in June due to higher feedstocks, particularly styrene. In the styrene market, spot prices rose 1.50 cents on the week, assessed Wednesday at 72.50 cents/lb FOB USG as demand has increased but supply was tight. Arbitrage windows to Europe and Asia were both open, sources said, but there was little to no product available for May and June. Styrene makes up around 65% of ABS, industry sources said. Styrene feedstock benzene rose 1 cent week on week to a Wednesday assessment at 442 cents/gal FOB USG. Feedstock US ACN export prices were assessed at $1,590/mt FOB USG Tuesday, a drop of $10/mt week over week. A source with a producer said prices in the ACN market could be hitting bottom tracking feedstock propylene prices, which could also be hitting bottom. Feedstock butadiene was assessed stable on the week at 77 cents/ lb CIF USG as demand in the market remained weak.

Europe
Spot prices for polyethylene terephthalate in Europe were assessed stable to higher this week, while freely negotiated contract prices were unchanged on market expectations of a rollover. Spot virgin prices rose Eur5/mt on the week, to Eur1,250-1,255/mt FD NWE, while UK prices were unchanged at GBP1,070-1,075/ mt FD. Prices for recycled product were slightly lower week on week as market participants said flake prices faced pressure from weak demand and imports. Prices in NWE and the UK were down Eur5/mt and GBP5/mt, respectively, at Eur1,010/mt FD and GBP865-870/mt FD. Some virgin resin producers noted stronger demand as seasonality took effect. Demand is improving based on seasonality improving, or rather the expectation of weather improvements, as well as low stocks in the pipeline and little imported quantities confirmed due to uncertainty on the price trend, one producer said. However, a lack of sustained improvement in European weather also impeded demand. The weather is still very poor, so there is no great excitement, and we need a good stretch of weather for activity levels to increase, one converter said. Meanwhile, price expectations continued to lead some converters to avoid spot purchasing altogether. I expect to keep working with my inventory because I do not expect prices to increase, one consumer said. Overall, spot demand remained weak, especially for the time of year. At the moment, it is on standby and there is low activity. Everyone is waiting for something and there will be last-minute buying as in recent months, a producer said. Overall, imports continued to pose no threat to domestic producers. Asian PET inched up $5/ mt week on week, to be assessed at $1,410/mt FOB Northeast Asia and $1,425/mt FOB Southeast Asia Wednesday, at a sixweek high, lifted by healthy demand and higher feedstock purified terephthalic acid costs. European converters said that although import offers were lower than current European spot offers, the difference was not large enough to justify taking the risk on ordering, given the lead time for arrival of imported product. The weakening of the euro against the dollar made imports even less attractive as the currency plunged to $1.2856 on Wednesday, from $1.3183 a week ago. In feedstock news, the European paraxylene contract price for May was confirmed fully settled at Eur1,120/mt FD NWE, a rollover from April, as further parties followed last Wednesdays initial settlement. PX

Asia
Asian acrylonitrile-butadiene-styrene was assessed up $20/ mt week on week at $1,893/mt CFR China and up $5/ mt at $1,920/mt CFR Southeast Asia Wednesday as costs increased due to feedstock styrene monomer prices firming. ABS producers were also raising their offer levels for June shipments, with Taiwans Chi Mei increasing its list price $20/ mt last Thursday to $1,920/mt CFR Hong Kong. The retail price of Chi Meis ABS in Hong Kong was as around $1,9201,930/mt Wednesday, down from around $1,940-1,945/ mt a week ago, sources said, with some saying there was ample ABS on offer in Hong Kong. Older cargoes of ABS were workable at the current retail price level, a source said, but added it would be difficult to sell at Chi Meis most recent offer level in the Hong Kong market. Other producers, from both South Korea and Taiwan, were offering at $1,900-1,910/ mt CFR China, sources said. A South Korean producer said it was offering its June shipment ABS at $1,900/mt CFR China and had sold small quantities of around 40-60 mt at this

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spot prices were down $5/mt week on week, at $1,350/mt FOB ARA Wednesday, as bearishness in Asia creating downward pressure on prices. NWE monoethylene glycol truck and barge spot prices were assessed unchanged week on week at Eur800810/mt. According to sources, the spot price could have reached a floor of around Eur800/mt following a recent slight uptick in demand. The European CP for MEG was yet to settle, although market participants expected a decline following the Eur100/ mt fall in the upstream ethylene contract price. This would mean a net reduction in feedstock costs for PET, but most in the market expected freely negotiated contracts to roll over due to seasonality. You could argue that there might be some scope for a slight reduction, but I think a rollover is likely, one converter said. In turn, rollovers would allow producers to benefit again from an increase in margins by not passing on feedstock decreases, should MEG be settled lower. RPET: Most in the RPET market saw prices roughly stable and fundamentals balanced. In the last two to three weeks, I have the impression there is virtually no change in the market. There is no great shortage of product, but there is also not an excess of flake on the market, a recycler said. However, some felt there was downward pressure on prices and that margins for some recyclers could be hurt by firm feedstocks. It is decreasing a bit on flake, while bales are not decreasing, one recycler noted. However, some reported that seasonality had at least led to increased demand. Demand was terrible until a few days ago, then the orders started to come, a recycler said. UK converters repudiated recyclers claims of tight flake availability in the region. Imported material is plentiful, so there is no shortage whatsoever. I am only purchasing the contract amount from the UK. Everything else comes from outside the UK, one converter said. Meanwhile, the increased strength of the pound sterling relative to the euro made non-UK European imports more attractive. The pound reached Eur1.183 on Wednesday, up slightly from Eur1.1822 a week ago and Eur1.1796 the previous week. UK recyclers said they were still selling at similar prices to previous weeks. Elsewhere, prices for UK packaging recovery notes were heard to have risen considerably due to Chinese restrictions on imported waste. The Chinese government initiated a crackdown on imports of low quality waste earlier this year, which has made it increasingly difficult to export some grades of mixed bottles and film plastics for which China was the largest buyer. As less material was being processed, PRN prices began to rise. Some sources said prices on the notes were as high as the GBP50s/mt, and one converter noted they could cause disturbance. Earlier this year, the price for PRNs was heard at around GBP8/mt, or even lower, and market participants were no longer paying the instruments much attention. However, the recent price spike, which showed no sign of abating, has brought increased focus on PRNs. Typically, recyclers claim the PRNs, although sometimes converters claim them, but recyclers will charge them a higher price for flake in exchange for allowing them to do so, sources said.

producer source said PET contracts could range from flat to up 2 cents/lb for May. April PET contracts were assessed at 82-83 cents/lb US railcar ($1,808-1,830/mt), down 4.75 cents from March. The PX contract settlement is a key variable in the price of PET feedstock purified terephthalic acid. A market source has said PX contracts could settle up 3-5 cents/lb for the month. If the PX contract settles as thought, PTA prices could rise 2-3.5 cents/lb. US monoethylene glycol prices rose slightly, with producers announcing 2 cents/lb increase to benchmark prices, before volume discounts. Asian contract prices for MEG, which also factor in to some US PET contracts, were nominated flat to down $20/mt for May. It takes 0.87 pounds of PTA and 0.34 pounds of MEG to make a pound of PET. US demand has been stronger, according to sources, who cited lower pricing and the increased need for PET for the spring and summer bottling season. DDP US West Coast prices were assessed Wednesday at $1,731/mt (78.5 cents/lb), flat week on week. Asian prices were assessed at $1,410/mt FOB Northeast Asia and $1,425/mt FOB Southeast Asia, as prices there reached a six-week high. Much of the spot material the ends up on the US West Coast comes from Asian markets. In feedstocks, US MEG market sources continued to talk of limited activity in the tight spot market. Spot prices were assessed Friday at 52.50 cents/lb FOB USG ($1,157/mt), flat week on week, with sources reporting no confirmed deals. US offers are at low 50s, but buying interest is still in the 40s, a US trader source said. Sources have said barges have been hard to find in recent weeks with two major producers down for turnarounds and two others preparing for them.

Asia
Asian polyethylene terephthalate inched up $5/mt week on week to be assessed at $1,410/mt FOB Northeast Asia and $1,425/mt FOB Southeast Asia Wednesday a six-week high lifted by healthy demand and higher feedstock purified terephthalic acid costs. The CFR China PTA price rose $7/mt week on week to be assessed at $1,051/ mt. Offer levels in the Asian PET market rose to $1,420/ mt FOB China this week from $1,410/mt the week before, but the price increase was limited to $5/mt after jumping $10-15/mt the week before. Some buyers decided to take a wait-and-see stance this week as another key product, paraxylene, may fall further amid selling pressure from PTA producers. The CFR Taiwan/China PX benchmark was assessed at $1,432.50/mt Wednesday, down $1/mt week on week. Chinese PTA producers, who usually buy PX in the spot market, have turned spot PX sellers recently in a bid to reduce high inventories. Chinese PTA producers accelerated PX selling in the spot market this week, which pressured the Asian PX market. In addition, the CFR China monoethylene marker fell $8/mt week on week to be assessed at $997/mt Wednesday. PTA and MEG are feedstocks for PET, while PX is a feedstock for PTA. Amid firmer PET prices, the Asian PET margin remained positive, calculated at plus $17.16/mt in Northeast Asia Wednesday compared with plus $15.46/mt last week, and at plus $32.16/mt in Southeast Asia, widening from plus $30.46/mt a week earlier.

US
US polyethylene terephthalate market sources were awaiting word of a US paraxylene contract settlement to get a better idea of potential movement in May contract prices. A US

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Polymer Feedstocks: Olefins


Polymer Feedstocks Ethylene
Europe FD NWE (Eur/mt) CIF NWE ($/mt) CIF MED ($/mt) Monthly Contract Price (May): US (/lb) FD USG Posted Contract Price (--- ): Net Contract Price (--- ): Asia ($/mt) FOB Korea CFR SE Asia CFR NE Asia Spot Friday 1109-1111 1249-1251 1189-1191 Weekly Average 1230.8-1232.8 1171.4-1173.4 Spot Friday 57.750-58.250 NA-NA Delivered NA-NA Delivered Weekly Average 56.550-57.050 Spot Friday 865-870 1090-1095 1070-1075 Weekly Average 916.3-921.3 1137.5-1142.5

Polymer Feedstocks Ethylene Glycol Assessments (cont...)


US (/lb) FOB USG A/F* Spot Friday 52.00-53.00

Fiber Grade Monthly Contract Price (MAY ): 53.05-54.05 FOB USG Asia ($/mt) CFR China CFR SE Asia MEG CP Nomination (MAY) CFR Asia MEGlobal: 1190 Sabic: 1150 Spot Friday 999-1001 999-1001 (1) Weekly Average 999.6-1001.6

1165-1165 FD NWE (Eur/mt)

Shell: 1190

(1) CFR SE Asia = CFR Indonesia.Note: *A/F denotes anti-freeze grade Asian ethylene glycol assessments are basis L/C 90 days.

Polymer Feedstocks Butadiene


Europe FD NWE (Eur/mt) FOB Rdam ($/mt) Spot Friday 1350-1360 1725-1735 Weekly Average 1369-1379 1756-1766

Asian ethylene spot assessments reflect LC 0-30 days. CFR SEA = CFR Indonesia/Thailand.

Polymer Feedstocks Propylene


Europe (Eur/mt) Poly Grade FD NWE CIF NWE Chem Grade FD NWE CIF NWE Poly Grade Monthly Contract Price (May): US (/lb) Ref Grade Poly Grade Chem Grade Poly Grade Contract Price (--- ): Chem Grade Contract Price (--- ): Asia ($/mt) FOB Korea CFR Taiwan CFR SE Asia FOB Japan CFR China Spot Friday 1249-1251 1294-1296 1319-1321 1234-1236 1319-1321 Weekly Average 1244.4-1246.4 1314.40-1316.40 Spot Friday dlvd USG 51.250-51.750 60.250-60.750 57.250-57.750 NA-NA Delivered NA-NA Delivered Weekly Average dlvd USG 51.150-51.650 Spot Friday 995-1000 980-985 Spot Friday 905-910 795-800 1025-1025 Weekly Average 997.5-1002.5 982.5-987.5 Weekly Average

Butadiene Monthly Contract FD NWE MAY: 1340-1340 (Eur/mt) US (/lb) CIF USG Monthly Contract Price (MAY ) Asia ($/mt) FOB Korea CFR Taiwan CFR SE Asia FOB Japan CFR China Spot Friday 1469-1471 1479-1481 1429-1431 (1) 1459-1461 1484-1486 Weekly Average 1469-1471 Spot Friday 76.50-77.50 79-85

1482-1484

(1) CFR SE Asia = CFR Indonesia. *A/F denotes anti-freeze grade.

Platts Global Ethylene Prices ($/mt)


1600

1400

Asian ethylene spot assessments reflect LC 0-30 days. CFR SEA = CFR Indonesia/Thailand.

Polymer Feedstocks Ethylene Glycol Assessments


Europe FCA NWE T2 (Eur/mt) FD NWE T2 (Eur/mt) CIF NWE T2 (Eur/mt) CIF NWE T2 ($/mt) Monthly Contract Price (May ) (Eur/mt) Spot Friday 800-810 825-835 800-810 1036-1049 NA-NA

1200

CFR FE Asia ($/mt) FD NWE (/mt) FAS Houston ($/mt) 10-Jan 04-Feb 01-Mar 26-Mar 19-Apr 15-May

1000 14-Dec

Notes: All olefin prices reflect assessments at close of previous Friday.

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Platts Polymerscan

May 15, 2013

Ethylene

United States
US spot ethylene recovered most of the ground lost in the late April, gaining 3.75 cents week on week, to be assessed Friday at 57.75-58.25 cents/lb FD USG. Market sources attributed the rise in pricing to the on-going turnarounds, tightening spot markets, and April contracts that were yet to settle. Producers are experiencing issues with the turnarounds, that contributes to the hike in spot and the contracts which are yet to settle, a source with a large buyer said. Somebody found a larger-thanoriginally-expected issue -- that is why we have not settled contracts yet and that is stirring spot markets up higher, a source with a major buyer said. Shell Chemicals Norco GO no.1 in Geismar, Louisiana, as well as Dow Chemical in Freeport, Texas, and ChevronPhillips Chemical in Port Arthur, Texas, were still undergoing planned maintenance. All three turnarounds are expected to be completed by early June. Williams Olefins was the latest producer to announce a planned maintenance during its first quarter earnings call -- the 50-day TA is slated to start in H2 August. In spot markets, May ethylene bids were last reported Friday at 57 cents/lb MtB Wms, against May and June offers heard at 59 cents/lb MtB Wms and 58.75 cents/lb, respectively. May ethylene spot trades were heard on Wednesday at 57 cents/lb MtB Wms, 57.75 cents/ lb MtB Wms, 58.25 cents/lb MtB Wms, and 58.375 cents MtB Wms. Also on Wednesday, a June spot deal was heard at 57.25 cents/lb MtB Wms. A third quarter deal was heard on Monday at 53.75 cents/lb MtB Wms. In feedstocks, spot ethane dropped 1.25 cents/gal week on week, assessed Friday at 27.75 cents/gal, while propane was 0.95 cent/gal lower, assessed Friday at 94.75 cents/gal non-LST Mt Belvieu. Downstream, May US polyethylene domestic contract increases were being met with significant resistance, as some buyers would not take product with the 4-cent/lb proposed increase included, sources said. Buy interest was low in the export markets, with expectations that spot prices could fall more.

Europe
The European ethylene market continued to combat broadbased persistent inventory length and thin derivative demand as spot prices faced further downward pressure despite some recent recovery in the upstream energy complex. Inland values fell to Eur865-870/mt FD NWE level, while coastal prices fell to $1,090-1,095/mt CIF NWE. Inland values were heard trading in Eur850-870/ mt FD NWE range this week. Coastal transactions in the Med were heard at $1,050-1,075/mt range. In the NWE market, there was a deal done for 4,000mt at $1,095/mt for May delivery, both counterparties confirmed. Despite higher crude oil and naphtha prices, the market is not improving. There is no confidence, no improvement from derivatives, an ethylene producer said, adding it was a struggle to place spot volume on the market this week. Despite ongoing production issues at steam crackers in France, the Netherlands and Belgium, supply continued to outpace available demand, sources said. In turn, no short-covering was seen on the back of production issues. The ethylene supply remains plentiful. While the Eur100/mt reduction in the contract price for May was a step in the right direction, it still failed to generate extra derivative demand...we have no extra incremental demand at all for us; we can just about absorb our contractual volumes, one ethylene consumer said. Meanwhile, European steam crackers have been running at reduced rates of around 78-80% since March, because demand from most ethylene derivatives has been low, sustaining prevalently bearish fundamentals across Europe. Demand for incremental ethylene volume also remained thin as derivatives struggled to consume core contractual volumes, which drove offers in the spot market significantly lower this week. We are not getting any positive messages from our derivatives, a second ethylene consumer said, adding that around Eur850/mt FD NWE was where some derivatives may show spot interest. Above that, it does not make sense, the consumer noted. In shipping news, two 5,500mt cargoes were heard booked from Houston to ARA. The first cargo was heard to have loaded at the end of April; the second one was set to load around May 15-20. This movement was not a spot transaction, trading sources said. In related news, a tender issued by the Algerian Sonatrach for 6,000mt of ethylene available to load from H2 May was heard awarded to the Med. Confirmation from parties involved was not immediately available at time of press. Meanwhile, in feedstock news, there was little immediate change in the structure of the European naphtha market Friday as a steady, recent flurry of fixtures to send material from the Mediterranean to Asia balanced out very low petrochemical demand in Northwest Europe, according to sources. Platts assessed CIF NWE naphtha cargoes at $825.75/mt, a fall of $17.25/mt on the day, although the fall was largely crude driven as prompt cracks remained fairly stable.

Latin America
Ethylene markets in the Latin American region remained quiet ahead of the second half of May. Venezuela was recently heard in the market for ethylene, with a major shipper reporting a 5,000-5,500-mt volume fixed from Europe to the port of El Tablazo for early May for an undisclosed price. For the Mexican market, which references US Gulf Coast pricing, US spot assessments gained 3.75 cents/lb ($83/mt) week on week to 58 cents/lb ($1,279/ mt) FD USG on Friday. Initial expectations for a 1-cent/lb drop for April contracts were fading, with sources saying the market was leaning toward a flat settlement to March at 48 cents/lb ($1,058/mt) but that a production issue in the US Gulf Coast region was keeping producers from committing to a settlement. For Brazil, which references European markets as most of its olefins production is naphtha-based, prices could be pressured lower by weaker contract prices in that region. The monthly contract price for European

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May 15, 2013

ethylene was fully settled for May down Eur100/mt at Eur1,165/mt FD NWE. No deals, offers or bids were heard by time of publication.

Asia
Asian ethylene prices were firm this week on the back of stronger upstream prices. Ethylene prices were assessed at $1,190/mt CFR Northeast Asia and $1,250/mt CFR Southeast Asia Friday, up $30/mt and $35/mt week on week respectively. Based on a theoretical cracking cost of $350/mt, CFR Northeast Asia prices were $25.63/mt in the red. A deal was heard concluded at $1,150/mt CFR China on Monday. However after Monday, there were no firm offers this week as sellers preferred to adopt a wait-andsee stance amid rising oil prices. Front-month June ICE Brent crude futures were assessed Friday at $103.88/barrel at 4:30 pm Singapore time (0830 GMT), up 11 cents/b day on day and up $1.44/b week on week. Feedstock naphtha prices on a CFR Japan basis rose $39.76/mt week on week to $865.63/mt. Adding to this, some sellers were reluctant to offer as they faced difficulty securing vessels. Bids were heard at $1,150-1,170/mt CFR Northeast Asia end of the week. An offer for H2 May loading was heard at $1,250/mt FOB Taiwan. Another deal was heard concluded this week to China on a formulae basis. Market sources noted that buying appetite have improved with firmer downstream market levels. High density polyethylene prices rose $25/mt week on week to be assessed at $1,410/mt CFR China Friday. Given a polymerization cost of $150/mt, profit margins for PE makers are at $70/mt. In Southeast Asia, several ethylene buyers were heard tentatively seeking cargoes for arrival in late June and July, but discussions had not started. Buying interest was in the low-$1,200s/mt CFR Southeast Asia for any June-arrival cargoes. In plant news, Indonesias Chandra Asri plans to debottleneck its naphtha-fed steam cracker at Anyer, West Java by 2015, a company source said Friday. The cracker currently has a design capacity of 600,000 mt/ year of ethylene and 306,000 mt/year propylene. With the debottleneck, ethylene output is expected to increase to 820,000-850,000 mt/year. However, the company has yet to schedule a date for the debottleneck.

in the market, a buyer source said, adding: Traders are saying now is the time to buy as prices are more likely to go up than anything else. The buyer source said that market participants had been finalizing business this week following negotiations last week, noting: A lot of business done this week was wrapping up business done last week. However, there is not a lot going on this week in terms of inquiries. Meanwhile, trade sources said the majority of business had been concluded at around Eur810/mt after bids slipped below Eur800/mt last week. There were offers in the market for spot MEG as high as Eur830/mt FCA, but no deals were reported concluded at these levels, according to the first trade source. There was also a buy tender in the market for 2,000 metric tonnes of MEG in NWE, a second trade source said, but he declined to provide further details and no further information on the matter was available at time of press. As Europe was pricing just above Asian levels, the first trade source said the arbitrage to Asia was unworkable, adding: There are no exports to Asia. It is a very opportunistic route and freight prices normally kill it. Moreover, the buyer source said he had previously targeted spot FCA prices of Eur750/mt, but said this level was too ambitious as the Asian price could rise. Meanwhile, the diethylene glycol market [DEG] market was experiencing temporary tightness as producer Sabic had run low on product, sources said. Sabic always has vessels coming in. The tightness wont last more than a week or so and wont have a lasting impact, the third trade source said. Sabic was not immediately available to comment. Spot DEG prices were assessed by Platts unchanged week on week at Eur840850/mt, reflecting the bid-offer range heard in the market. No DEG deals were reported this week.

United States
US monoethylene glycol prices remained steady for the week as market sources continued to talk of limited activity in the tight market. Spot prices were assessed at 52.50 cents/lb FOB USG ($1,157/mt), flat week on week, with sources reporting no confirmed deals. US offers are at low 50s, but buying interest is still in the 40s, a US trader source said. Sources have said barges have been hard to find in recent weeks with two major producers down for turnarounds and two others preparing for them. Month-long turnarounds began last week at MEGlobals 850 million lbs/year plant in Fort Saskatchewan, Alberta, and Indoramas 615 million lbs/year facility in Clear Lake, Texas. Upcoming turnarounds are also slated for later this month and next month at Formosas 660 million lbs/year facility in Point Comfort, Texas, and Shells 800 million lbs/year facility in Scotford, Alberta. There were indications from the market that activity could pick up, especially when supplies begin to loosen back up. A US trader source said that antifreeze canning season should begin in early June and pick up even more in July. That should create some activity, the source said, adding I still havent seen a major buy-in by blenders, so they must think the price still has room to drop. US PET demand continued to strengthen, with sources pointing to lower prices and an increased need for PET from buyers as the spring and

Ethylene Glycol

Europe
Northwest European monoethylene glycol [MEG] truck and barge spot prices were assessed by Platts unchanged week on week, at Eur800-810/mt, reflecting ongoing business concluded at this level, according to sources. According to sources, the spot price could have reached a floor of around Eur800/mt, following a recent slight uptick in demand. I think the market may have bottomed out. We believe there is a bit more activity and an increase in inquiries. It is not that demand is strong, but the market is a little bit more active than the past two or three weeks, a trade source said. In turn, bullish buy indications were heard

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Platts Polymerscan

May 15, 2013

summer bottling season continued. May US contracts were assessed Friday at 53.55 cents/lb ($1,181/mt), a 1.7 cents increase from April levels. MEGlobal set its North American benchmark price for May at 63 cents/lb, a 2 cent increase from April, and US producers implemented similar increases. Depending on the volume stipulated in the contracts, there are discounts for buyers of as much as 15%. April ethylene contracts had yet to fully settle, with some settlements heard 0.75 cent lower than March. The net transaction price is not changing until next month, a market source said. The ethylene net transaction price settled for March at 48 cents/lb.

Asia
Asian monoethylene glycol prices increased $14/mt week on week to $1,000/mt CFR China/CFR Southeast Asia Friday, tracking rising futures for fellow fiber intermediate purified terephthalic acid. On Tuesday, MEG prices climbed $10/mt day on day to cross the $1,000/mt level and stand at $1,005/ mt CFR China Wednesday. Then the market became quieter as participants were away to attend the Asia Petrochemical Industry Conference in Taiwan. On Friday, bids were heard at $995/mt CFR China against offers at $1,005-1,010/mt CFR China. Market sources noted that offers for H1 June shipments were relatively thin compared with H2 May shipments. Actively traded September PTA futures on the Zhengzhou Commodity Exchange rose Yuan 124/mt week on week to Yuan 7,870/mt Friday. Sources said the MEG market lacked direction and tracked PTA futures closely this week. MEG prices were controlled by the PTA futures price this week rather than market fundamentals. In fact, most people are directionless on how MEG prices will be moving forward, said a Chinese trader. The inventory level in East China fell to 900,000-910,000 mt Friday from 930,000-940,000 mt a week earlier. The sales-production ratio was heard above 60-80% Thursday and shot up to 100% Friday, according to sources. Operating rates at most polyester plants were heard at 70-75%. Several market sources are cautious about the second half of 2013, when they expect an influx of Middle East material into China. The market in June is lacking in visibility as most are unsure how much MEG is coming and when exactly it is coming, said a Chinese end-user. In plant news, Taiwans Nan Ya Plastics has delayed the restart of its 700,000 mt/ year No. 4 MEG line in Mailiao to early June, a company source said Wednesday. The line was shut in early April for 45 days of scheduled maintenance, but the work has taken longer than planned. It took longer than expected to repair the equipment and thus we will have to delay the restart to early June, the source said.

interest. Incremental spot demand remained subdued as buyers continued to lack incentive to rebuild stock and were still struggling to absorb contractual volumes as the performance of key derivatives failed to show credible improvement, sources said. Derivative utilization rates remained mostly at Aprils level or, in some cases, were scaled back. The majority of derivatives continued to rely heavily on export outlets as underlying domestic demand lagged. Propylene sellers talked of the ongoing struggle to attract firm interest this week. Most European systems were seen balanced-to-long. Although there was no overwhelming length, selling interest continued to outpace buying interest, sources said. We expected better spot interest, but that really has not materialized...the market is very quiet and there are no spot requests, a producer said, adding: The market is not showing recovery in the short term. No one is looking for product; there is some interest but for June deliveries only. In particular, placing prompt polymer grade volumes was a challenge, sellers said. However, the problem was more pronounced in the coastal chemical grade market, where widespread containment issues and length in inventories made sales more difficult. An offer for May delivery at Eur800/mt CIF NWE failed to attract firm bids as buyers of coastal chemical grades had no room to absorb additional volumes, sources said. Coastal chemical grade spot levels were assessed down this week at Eur795800/mt CIF NWE. Meanwhile, inland chemical grade values were under less pressure and remained supported at Eur905-910/mt FD NWE. In Germany, some buyers expressed caution there could be a delay in the start-up of PCK Raffinerie at Schwedt, in northeast Germany. There was no official comment available from PCK Raffinerie at time of press. They were going to put the feed through this Wednesday, with a hope to produce on-spec product by the weekend, a propylene consumer said, adding: The attempts have failed, now they are going to be restarting at a later date...this could change the situation in Germany; another propylene consumer said: I did hear they might be delayed, but nothing is confirmed so far; another source added: We are hearing something similar, but we struggle to get the full confirmation due to holidays. Earlier in the week, a company spokeswoman commented on Tuesday that maintenance on the site had been completed as planned and units were gradually restarting. Most of the units are expected to be back by the end of this week, the spokeswoman added, and by the middle of next week, the whole refinery is expected to be fully back on line.

United States
US spot refinery-grade propylene was marginally higher for the week, assessed Friday at 51.25-51.75 cents/lb delivered, gaining a quarter-cent amid lackluster trading. Market discussion continued to center on May propylene contracts -- with expectations for settlement were heard in the range of a 1-3 cents/lb decrease from the current 63 cents/lb for polymer-grade propylene and 61.50 cents/lb for chemical-grade propylene. In spot markets, May RGP

Propylene

Europe
European spot polymer grade propylene values retreated marginally during the week to be assessed at Eur980-985/ mt CIF NWE, a Eur5/mt fall week on week, on low buying

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Platts Polymerscan

May 15, 2013

bids were heard at 50.50 cents/lb MtB-pipe throughout the week, against offers heard in the range of 52-52.50 cents/ lb MtB-pipe. Refinery-grade deals were not heard by the close of assessment. In polymer-grade, May bids were last heard on Friday at 59 cents/lb MtB-pipe, against offers heard at 61 cents/lb MtB-pipe. May PGP was last heard traded Wednesday at 60.50 cents/lb MtB-pipe for undisclosed volumes. Polymer-grade propylene gained 1 cent/lb for the week, assessed at 60.25-60.75 cents/lb Friday. No spot bids, offers or deals were heard for CGP -- the assessment also climbed one-cent to maintain the 3-cent/lb discount to PGP, assessed Friday at 57.25-57.75 cents/lb. In production, Williams Olefins announced a 50-day turnaround at its Geismar, Louisiana, steam cracker in first quarter earnings conference call. The turnaround is slated for the second half of August. In energy, NYMEX June crude was up by 43 cents week on week, to settle at $96.04/barrel on Friday. At current inventory levels, US stocks of propylene for nonfuel were down 184,000 barrels, to 3.669 million barrels in the week ending May 3, according to Energy Information Administration report issued Wednesday. Refinery operating rates were up by 2.6% at 87%, according to the report.

Latin America
Propylene exports out of Brazil continued into Mexico, with a cargo of more than 9,000 mt of product aborad the Maple 3 unloaded at Altamira midweek, ports records show. Late last month, Brazils Braskem was heard fixing a 4,000 mt volume aboard the Victoria Kosan for May 7-10 to Europe, departing from Aratu port. Mexico looks to the US Gulf Coast region for pricing guidance, and US contracts for May could fall by 1-3 cents/lb, given weakness in spot pricing for much of April and into May. US PGP and CGP contracts last settled for April at 63 and 61.50 cents/lb, respectively. In Brazil, propylene prices were also expected to be pressured lower by international markers, specifically the Northwest European contract price, which this week settled Eur80 lower for May at Eur1,025/mt ($1,334/mt) FD NWE. Brazil looks to NWE for guidance on propylene pricing, Braskem sources said, as the countrys olefins production is also naphtha-based. In downstream polypropylene, import prices could be on the verge of increases as feedstock costs pushed Asia-origins into South American higher. Colombian producer Propilco was heard exporting product to Puerto Rico at around $1,610/mt CFR San Juan and offering into Peru at $1,600/mt CFR basis, up some $60/mt week on week. In Brazil, Braskem decreased its export price to Mercosur countries by about $20/mt, according to a company source.

cargo traded at $1,250/mt FOB Korea Monday and an endJune loading cargo traded at $1,250/mt FOB Korea Tuesday. A South Korean trader sold two H1 June arrival cargoes at $1,325/mt CFR China on 90-day letters of credit terms. Japans JX Nippon traded a late May/early June loading cargo of 1,500 mt at $1,328/mt CFR East China Tuesday to a trader and offered a June 1-10 arrival cargo at $1,340/mt CFR China Friday. Bids were at $1,300-1,315/mt CFR China Friday. A Japanese trader sold a late May/H1 June arrival cargo Thursday on formula-basis. Upstream, front month ICE Brent crude oil futures were assessed Friday at $103.88/barrel at 4:30 p.m. Singapore time (0830 GMT), up 11 cents/b day on day and $1.44/b week on week. Supply from Japan is expected to tighten in June as Nippon Shokubai hopes to restart in late May its 460,000 mt/year Himeji acrylic acid plant in western Japan, market sources said Friday on the sidelines of the Asia Petrochemical Industry Conference in Taipei, Taiwan. A company official confirmed the information, saying: Our acrylic acid plant has not operated yet and the timing is still unknown as to when the plant will be restarted. He said the company hopes to have one or two acrylic acid plants restarted by the end of May. It is a wish and hope. Local government has not given any approval, he said. However, some propylene market participants were skeptical about the expected restart date, given the pending government approval. There has been talk about the plant restarting in February, and in April, and now end-May, one trader said. The company will need about two weeks to prepare after obtaining the approval, a Japanese producer said. The Himeji chemical plant was shut September 29, following a massive explosion at an acrylic acid tank that killed one firefighter and injured more than 30 people. A Japanese trader said he heard Nippon Shokubai had stocked up propylene inventory prior to the explosion and the impact of restarting the plant is not expected to be felt immediately in the propylene market. Propylene can last for up to a year in tanks without a change in quality, a Chinese trader said.

Butadiene

Europe
Butadiene prices continued to retreat in Northwest Europe this week as trading was punctuated by holidays and buyers were absent from the market. Import possibilities from Asia remained unworkable, traders said, as demand was weak in both regions and price differentials insufficiently wide to encourage transcontinental movement. Asian prices were seen around $1,470/mt FOB Korea this week, too high for trade into Europe, especially considering expectations of a bear market for the rest of May and June. However, late Friday, traders said there were rumors of offers nearer $1,400/mt FOB in Asia, although netbacks would likely see the US as the preferred destination for the material, which was a theory supported by US market sources, who nonetheless questioned where the material would go, considering weak demand in the region. On the US side, sources reported crude C4 trade between Europe and the US

Asia
Asian propylene prices increased this week on expectations of tighter supply and firmer crude oil prices. Four of the markers climbed $15/mt week on week to be assessed Friday at $1,250/mt FOB Korea, $1,235/mt FOB Japan, $1,320/mt CFR China, and $1,295/mt CFR Taiwan. Southeast Asian propylene prices, however, rose $10/mt week on week to $1,320/mt CFR Friday. Early in the week, a mid-June loading

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Platts Polymerscan

May 15, 2013

was still strong, with as many as four or five vessels lined up for the trans-Atlantic crossing during May. Some of these vessels were reported to contain mixed C4 cargoes, but no further details could be obtained by the close Friday. Two sailings were reported fixed for the end of May departing ARA for the US Gulf. The Navigator Libra and Navigator Magellan were reported to be loading full cargoes of C4s, sources said, without adding further details. Although European prices were seen moving lower this week, and US levels were seen in the mid-to-high 70s cents/lb, a butadiene arbitrage was not theoretically open, considering shipping costs of around $260/mt. On the inland market, sources saw butadiene valuations start to slide. This came in the wake of slumping crude C4 prices, which fell as much as 10% this week, although no firm trade was reported. Sources said the spot price premium to the monthly contract price of Eur1,340/ mt FD NWE was receding to a level where there was almost parity, but no business was reported concluded. Meanwhile, sentiment was demand-side driven, sources said, as the region prepared for a number of turnarounds on the derivative side, including the regions largest butadiene consumer, Rhodia, which confirmed it would take its 325,000 mt/yr adiponitrile plant at Chalampe offline between May 18 and June 25. In addition, there were pending outages at Synthos 80,000 mt/ yr SBR plant at Kralupy, Czech Republic; and an unconfirmed four-week outage at Lanxess 100,000 mt/yr NBR plant at La Wantzenau, France. Sources surveyed last week said they expected the contract price for June to show a similar decrease to May, citing an overlarge premium to naphtha values and lack of demand due to the outages. I think from next week, things will relax on the spot market, one consumer said, adding: If people cover from contracts, there is no need of spot. Even a slew of outages on the production side failed to impact prices, sources noted. An internal force majeure at Shell was yet to be resolved, according to sources close to the operation, while Totals Gonfreville cracker was reported to be still offline Friday. Moreover, there were rumors of production issues at Solvays Feyzin site, but this was not confirmed. Basically, the three units with disruption on top of heavy turnarounds had no impact. In other years, this situation would have boosted spot to a minimum 10% above the contract price level, one source said. However, downstream demand in the region continued to move toward a new low. Tire demand in Europe is close to a 20-year low, according to latest figures from the European Automobile Manufacturers Association, while export demand for derivatives was also nonexistent. Nonetheless, in the long term, there was news this week of further expansion to European BD capacity. Austrian oil and gas company OMV said it would spend about Eur230 million ($301.4 million) to build a new butadiene plant at its Burghausen refinery, in Germany, as well as on upgrading its existing plant in Schwechat, Austria. Manfred Leitner, OMV executive board member responsible for refining and marketing, said in a note issued by the company: We are convinced that we can exploit economies of scale and synergies between the two refineries as regards the planned extension and new construction at the butadiene plants at our Schwechat and Burghausen sites. In future, these two sites will enable OMV to cover around six percent of total butadiene

production in Europe. The expanded butadiene plant in Schwechat was expected to start operations in June 2014, while the operational start of the new construction in Burghausen is planned for the second quarter of 2015, OMV said, without adding details about the capacities concerned. European sources said values of crude C4 could be down around 10% from the past week amid cooling US import interest and butadiene shutdowns in the region. Market sources said prices sank from the past weeks level of a 1.4 multiple to naphtha on a FOB basis toward a 1.25 factor as traders sought to scoop up excess material that had resulted from weak downstream demand and butadiene maintenances in the region. During the week, two export cargoes were reported by shipping sources. Both cargoes were reported contracted by trader Kolmar, but a company spokesman was unavailable to confirm this. The first vessel was the Maersk Harmony, fixed to sail early May from ARA with up to a full cargo of crude C4 and heading for the US Gulf. Sources said this material may have been obtained via pre-arrangement from LyondellBasell to counteract the companys plant shutdown, but this could not be confirmed with either party. The second vessel, the Sloman Ariadne, was reported loading first in Aliaga, Turkey, where Kolmar has a regular contract with local producer Petkim, before possibly topping up to a full cargo with material in NWE and then also sailing to the USG. Meanwhile, other traders said US appetite for material had been much slower in recent weeks as exports from Asia to the US also dried up. One seller said he had found it impossible to get bids higher than the mid-1.2s for material he had on offer, while other sources said even lower prices would be necessary for an arbitrage to the US to work. If you have a big vessel going to USA for $170-180/mt (freight), I think you still need lower than 1.25, one trader said. European sources said little or no trade was concluded in the raffinate-1 market this week, due largely to holidays in many countries. With knowledge of these holiday breaks, most participants managed to get business concluded beforehand, sources said. There are no discussions in this part of the month. Everyone who needed to buy is covered and sellers have sold off length, one source said, adding that only production hiccups or cracker anomalies could alter the situation. Nonetheless, sources said the product continued to enjoy healthy demand, which belied the situation of other C4 products. Demand for MTBE continued to be reported strong in the region and was buoying the consumption of raffinate-1, sources said. Meanwhile, lighter cracking, crude C4 exports out of the region, a number of turnarounds at butadiene extraction units, as well as weak derivative demand for butadiene, all ensured the market remained in balance. Nonetheless, with the rest of the C4 chain moving down, sources said this also affected raffinate-1 sentiment. If crude C4 is down, and BD is down, raffinate should go down, too, one source said, adding that he saw value just above a 1.2 factor to naphtha. The latest trades reported last week were done at a 1.24 factor to naphtha on a CIF NWE and at a factor of 1.03 to naphtha on a FOB Med basis, equating this to 1.22 or 1.23 on a CIF NWE basis. Upstream, naphtha was assessed at $843/mt CIF NWE Thursday, up from a level of $791.50/mt CIF NWE from the previous week.

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May 15, 2013

United States
US spot butadiene was assessed stable on the week at 77 cents/lb CIF USG despite persistent weak demand. Spot pricing was heard notionally talked in the mid-to-high 70s this week. US spot butadiene has been falling for the last two months after reaching a high, assessed at 92 cents/ lb CIF USG March 8 according to Platts data. Sources attributed to the fall to weak demand as well as lower prices in Asia, which have allowed for finished butadiene as well as feedstock crude C-4 to be shipped over to the US. Sources said at least two traders might be loading butadiene from Asia to the US in May, with one of the traders heard loading as much as 11,000 mt of product. Further specifics on the shipments was unavailable. There is supply from Asia, but demand is not there. I am hearing lots of volume available or coming from Asia, but just do not know where it is going, one trader said. Asian butadiene was assessed stable on the week on an FOB Korea basis at $1,470/mt and rose $5/mt over the week on a CFR China basis at $1,485/mt Friday. From Europe, one ship with up to a full cargo of crude C-4 loaded early May from ARA heading to the US Gulf, and a second ship was also loading in mid-May first in Turkey, before heading to Northwest Europe and then sailing to the US Gulf with up to a full cargo of butadiene and crude C-4, according to shipping reports. Two more ships were also loading at the end of May out of Europe and headed to the US Gulf with up to a full cargo of butadiene and crude C-4, according to shipping reports. European butadiene fell $50/mt on the week, assessed Friday at $1,730/mt FOB Rotterdam, and European crude C-4 fell $59/mt on the week to $1,090/mt CIF NWE, with a 1.32 factor to naphtha. Supply in the US continued to be characterized as snug despite the imports. Demand in the downstream acrylonitrile-butadiene-styrene market was steady, sources said, and demand in the nylon industry was characterized as stable. However, downstream demand in the tire industry remained weak, especially for demand in replacement tires, while demand in the SBS and styrenebutadiene rubber markets was characterized as sluggish. In contracts, the May US butadiene contract price settled in a 79-85 cents/lb ($1,742-$1,874/mt) split settlement, with ExxonMobil at 85 cents/lb, and LyondellBasell, Shell Chemical and TPC Group at 79 cents/lb, sources said. Producer confirmation was unavailable.

mt) FD NWE, a decrease of Eur75/mt from the previous month. No bids, offers or deals were heard in the region for the week. Butadiene was last heard making its way into Mexico in late April, with a 1,900-mt parcel arriving at Altamira, Mexico, from Rio Grande, Brazil, according to port records. Pricing information was unavailable by time of publication. The region tracks US pricing, and US Gulf Coast assessments have trended down since reaching a 2013 high, assessed at 92 cents/lb CIF USG March 8 according to Platts data.

Asia
Butadiene prices firmed slightly Friday week on week as downstream synthetic rubber prices climbed higher, tracking their natural counterpart. Several market participants were in Taipei on Thursday and Friday to attend the Asia Petrochemical Industry Conference. Sellers were aiming for $1,500/mt FOB Korea for June cargoes, saying that the participants will be back in the spot market after APIC. According to Platts data, 1502 styrene-butadiene rubber prices were up $60/mt week on week at $2,050/mt CFR Northeast Asia. The CFR China benchmark for butadiene gained $5/mt to $1,485/mt week on week while its FOB Korea counterpart was unchanged from last Friday at $1,470/mt. In spite of the higher SBR1502 prices, producers were cautious as the gains could be short-lived given several SBR plants were still running at reduced rates due to poor demand. For instance, South Koreas Kumho Petrochemical plans to operate two of its synthetic rubber plants at Yeosu at reduced rates indefinitely, following a restart May 6. The 120,000 mt/year butadiene rubber plant and 60,000 mt/year solution SBR plant were shut April 1 due to weak market conditions, but were restarted this week at reduced rates of 60% and 70% capacity, respectively, to fulfill contractual obligations, a source said. On Thursday, Malaysias Lotte Chemical Titan Trading awarded its sell tender offering 2,000 mt butadiene for June 1-5 loading from Pasir Gudang to a trader on a floating price basis. Also this week, Thailands Bangkok Synthetics issued a tender offering up to 2,800 mt of butadiene for loading over June 1-5. The tender closes on May 13. In production news, South Koreas Yeochun Naphtha Cracking Center shut its 240,000 mt/year butadiene extraction unit at Yeosu Thursday for maintenance that will last until June 4, a company source said. Prior to the shutdown, the unit was operating at about 90% of capacity because of contamination at an extractor caused by polymerization. The turnaround has not affected the operating rates of YNCCs three naphthafed steam crackers, which supply crude C4 feedstock to the butadiene unit. In other news, China imported 130,215 mt of synthetic rubber in April, down 12% from 147,733 mt in March, but 10% more from 118,174 mt year on year, preliminary data released Wednesday by the General Administration of Customs showed. With the April data tallied, China has imported 523,689 mt of synthetic rubber in the first four months of 2013, nearly 10% higher than the 477,912 mt received in the corresponding period last year.

Latin America
Butadiene trade in the Americas was quiet this week, with no inbound or outbound volumes heard by time of publication Friday. Butadiene prices in Latin America were likely to ease for May as markers in Europe and the US continued to point down. In the US, which is referenced by producers in Mexico and Brazil alike, the May contract price settled 1-5 cents/lb ($22-110/mt) lower from April at a 79-85 cents/lb ($1,742-1,874/mt) split settlement, sources said. In Europe, the NWE butadiene monthly contract for May delivery was agreed at Eur1,340/mt ($1,746/

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Platts Polymerscan

May 15, 2013

Polymer Feedstocks: Aromatics


Paraxylene Polymer Feedstocks Aromatics
Weekly Average Spot* Styrene FOB Korea ($/mt) Styrene FOB Rdam ($/mt) Styrene FOB USG (cts/lb) Paraxylene FOB Korea ($/mt) Paraxylene FOB Rdam ($/mt) Paraxylene FOB USG ($/mt) Monthly Contract Price Styrene Styrene Styrene Styrene Styrene Styrene Barge AVG CP (Eur/mt) (May) 1400.00 Barge FD NWE CP (Eur/mt) (May) NA Barge FOB Rdam CP (Eur/mt) (May) NA Barge FOB ARA CP (Eur/mt) (May) 1400.00 Truck FCA Rdam CP (Eur/mt) (May) 1405.00 FOB USG (cts/lb) (May) 75.00-76.00 NA NA 72.25-72.25(Q2)# 1633.20-1634.20 1612.00-1613.00 70.43-70.93 1414.00-1415.00 1356.50-1358.50 1394.00-1404.00

Europe
European 3-30 day NWE spot prices were assessed at $1,365/ mt FOB ARA, up $10/mt both on Friday and the week on firmer Asian and US sentiment. Trade was described as thin as the focus of European market participants this week was focused on contract price negotiations. Asian second-half June delivered prices climbed $12/mt to be assessed at $1,448/mt CFR Taiwan-China, while the US was assessed at $1,400/mt FOB USGC on Thursday. Elsewhere, one European trader felt it would be prepared to pay around $1,345/mt FOB ARA. Sources talked the net-back for 5kt parcels to the US East Coast at $50/mt, with the option of shipping about 10kt at around $45/mt. However, net-backs to Asia were still pricing at around $100/mt, although the Asian market was not so viable as an export option, because of current Asian spot pricing, according to market sources. Meanwhile, an initial Northwest European paraxylene contract price has been settled at Eur1,120/ mt ($1,476/mt) FD NWE, according to a producer source. According to sources, Shell Chemicals settled with at least two consumers, but Shell would not confirm and consumers were not available to comment. Total Petrochemicals could not comment on the settlement. The May CP represented a rollover from the April accord. Some market sources pointed to a rollover because spot prices had remained relatively stable through April at around $1,350-1,360/mt FOB ARA, according to Platts data. I think that it is too high. Sub-Eur1,100/mt; Eur1,080-1,085/mt would have been a fair settlement, the consumer said, adding: There is no scope for getting margins, given that back up the chain [crude] is lower. If you look at Asia, it [spot] is low. If you take [an average April price] of $1,420/mt FOB, this is below Eur1,100/mt when converted into Euros [Eur1,078/ mt using an eurodollar rate of $1.3172]. The settlement was done without the Asian contract price marker, which failed to settle this month. Asian buyers and sellers were unable to narrow a $25/mt price gap. ACP suppliers reduced their offers to $1,425/mt CFR, but end-users resisted at $1,400/mt CFR. It is the second time this year that PX ACP negotiations ended without settlement. The last time was in March, when JX Nippon Oil and Energy settled with Oriental Petrochemical (Taiwan)Corp at $1,670/mt CFR, which other ACP negotiators did not follow.

Paraxylene CFR Asia Average (May ) Paraxylene FD NWE (Eur/mt) (May) Paraxylene FOB USG (/lb) (Apr)

* Average prices for week ending previous Friday. # US PX CP are typically settled retroactively, prices refer to most recent settlement. To convert Cts/lb to $/mt, multiply by 22.046.

Asia Styrenics Prices


2000 (/lb) CFR FE Asia GPPS Styrene FOB Korea 1900

1800

1700

1600 19-Dec

23-Jan

20-Feb

20-Mar

17-Apr

15-May

Notes: All aromatics prices reflect assessments at close of previous Friday.

United States
The US spot paraxylene assessment increased $15/mt over the week Friday to $1,405/mt FOB USG, tracking higher Asian paraxylene prices, sources said. The day-on-day change was an increase of $5/mt. Asian demand showed improvement amid stronger downstream PTA demand, sources said. Historically, PX strengthens during the warmer months as downstream PTA and PET demand increases, sources said. On Monday, spot

PX gained $10/mt to an assessment of $1,400/mt FOB USG as Asian PX prices gained. Spot retracted $5/mt to an assessment of $1,395/mt FOB USG on Tuesday as Asian prices weakened. Paraxylene held firm Wednesday before rising to be assessed at $1,400/mt FOB USG. No spot deals were heard over the week. In contracts, no PX settlement was heard by time of publication. Industry sources said that the May contract price could settle 3-5 cents higher. Asian paraxylene gained $15/mt on the week to Friday assessments at $1,422.50/mt FOB Korea and $1,449.50/mt CFR Taiwan/China.

Asia
Asian paraxylene rose $12/mt day on day and $15/mt week on week to be assessed at $1,422.50/mt FOB Korea and $1,449.50/mt CFR Taiwan/China Friday, lifted by

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Platts Polymerscan

May 15, 2013

end-week short covering for June. Trading activity was limited throughout the week as most market participants were in Taiwan to attend the Asian Petrochemical Industry Conference over Thursday-Friday. During the Platts Market on Close assessment process Friday, trader China Aviation Oil posted a bid for June at $1,440/mt or July at $1,432/mt on a CFR Taiwan/Ningbo/Dalian basis, which was not hit before the close. Off-screen during the MOC process, a bid for June moved up $1,450/mt CFR Taiwan/Ningbo/Dalian, while no offers were reported. Platts did not fully use the off-screen bid as numbers registered on screen are given greater weighting. The downstream purified terephthalic acid market was also quiet Friday, with the CFR China PTA marker assessed flat day on day at $1,057/mt. September PTA futures on Chinas Zhengzhou Commodity Exchange rose Yuan 10/mt day on day to close at Yuan 7,870/mt. Market sources said some short covering activity for June emerged late Friday, while sellers adopted a wait-and-see stance and no offers were reported. Chinese PTA markets have been active recently selling spot PX cargoes. It seems Chinese PTA producers are still interested in selling spot PX cargoes, a market source said. But selling quantity from Chinese PTA producers may be limited as a rebounding polyester market in China may increase the operating rates of PTA makers there. Upstream, June ICE Brent futures inched up $0.11/barrel day on day to be assessed at $103.88/b Friday at 4:30 pm Singapore time (0830 GMT). Despite downstream paraxylene market rising $12/mt day on day and up $15/mt week on week to $1,422.50/mt FOB Korea and $1,449.50/mt CFR Taiwan/China on firmer purified terephthalic acid market, Asian isomer-MX prices were largely steady amid thin trade. Asian isomer-grade mixed xylenes fell $2/mt day on day and unchanged week on week to be assessed at $1,205.50/mt FOB Korea and $1,217.50/mt CFR Taiwan Friday. Trade activities were thin with many market participants out the whole week for the Asia Petrochemical Industry Conference held from Thursday to Friday in Taipei, Taiwan. Front-month June ICE Brent crude futures inched up 11 cents/barrel day on day and was up $1.44/b week on week to be assessed at $103.88/b at 4:30 pm Singapore time (0830 GMT) Friday. Asian isomerMX was on a downtrend this week, hit by bearish PX and firm selling. The Platts Market on Close assessment process has been quiet all week except Monday when GS Caltex registered a bid for H1 June at $1,210/mt CFR Taiwan, raising to $1,220/mt at close. On Friday, an offer for a H2 June cargo was heard at $1,230/mt FOB Korea off-screen, while another offer for the same laycan was heard at $1,210/ mt FOB Korea. In related market news, Chinas Dragon Aromatics plans to start commercial operations at its new 800,000 mt/year PX plant at Gulei in Fujian province over June-July, a market source said Monday. The plant started test runs April 22 using secondary feedstock isomer-MX, the source said. Condensate is likely to be the main feedstock at the plant, with isomer-MX used to a lesser extent. The company would likely have to buy up to 300,000 mt/year of isomer-MX, based on full runs using condensate as the main

feedstock and isomer-MX as additional feedstock, Platts reported previously. We are trying to produce on-spec PX through the test run and will run the plant at 50-70% of capacity once commercial operations begin, the source added. The startup of the plant has been delayed several times for various reasons including regulatory approvals, construction delays and feedstock procurement issues. The company initially planned to bring the plant online in March, but this was delayed due to regulatory scrutiny about changes to its feedstock mix. Separately, Dragon Aromatics plans to bring forward the startup of a second 800,000 mt/year PX plant at Gulei to Q4, from earlier market expectations in 2014, the source added. Meanwhile, China Petroleum and Chemical Corp., or Sinopec, raised its ex-works price of isomer-MX in South China by Yuan 150/ mt, or 1.7%, effective Tuesday, market sources said. Sinopec Guangzhou raised its offers for isomer-MX to Yuan 8,850/ mt. This is the first time in May that Sinopec has adjusted its MX prices. The company last adjusted prices in South China on April 23, when it cut prices by Yuan 200/mt.

Styrene

Europe
Northwest European styrene monomer spot prices posted a strong rally toward the weeks end, rising $30/mt day on day, to close the session at $1,640/mt FOB ARA. Compared to the previous weeks close, the increase was $69.50/mt or 4.4%. The decision by several of the regions styrene products to implement substantial cutbacks in plant operations, or to shut units completely on poor margins or production issues, resulting in tightening supplies, accounted for pronounced short-covering this week, which pushed values up. Styron shut its 500,000 mt/year styrene plant at Terneuzen, the Netherlands in May, a company source said Friday, explaining a series of spot purchases that totaled around 10,000 mt so far this month. On the other hand, Total was still running its 650,000 mt/year Gonfreville styrene unit at reduced rates on the back of earlier cracker issues as rumors circulated the marketplace that this unit was also shut. Total was seen purchasing up to 5,000 mt of spot styrene Friday, forming the basis of the days gains. The market opened a touch higher at $1,610-1,630/mt FOB ARA for May and $1,605-1,630/mt FOB ARA for June, but soon rallied higher, culminating in several trades. May barges were traded at $1,620/mt, $1,625/mt and $1,630/mt FOB ARA; a June CIF barge was also dealt at $1,630/mt; and trades for May were rumored to have transpired as high as $1,640-1,650/mt FOB ARA. The latter trades could not be verified. Stronger prompt demand also resulted in the May/ June structure flipping into backwardation Friday as a May/ June roll was traded at $10/mt midday. It is an indication is slowly getting physically tighter, a trader said, adding: Styron kept sniffing around for prompts. However, at close of trade, values slipped lower amid a sharp plunge upstream in the energy complex. Bid-offer indications closed

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Platts Polymerscan

May 15, 2013

at $1,640-1,645/mt FOB ARA for May-loading material and $1,625-1,650/mt FOB ARA for June-loading product. The styrene/benzene spread is barely bread-and-buttertype margins, and when you shut a plant you shut it for at least two weeks and you cover, a source said, explaining recent prompt demand. With Total, their problem may be compounded by the cracker outage and they do not have LyondellBasells volumes either. My gut feeling is with what Styron and Total have done, the physical volume available is n0t great and my worry is that we are oversold, the source added. Typically, styrene producers require a Eur200-250/ mt ($260-325/mt) premium over benzene to breakeven. On Friday, this spread was assessed at $275/mt. The styrene/ benzene spread hit a 2013 low on April 22 of $140.50/ mt, according to Platts data, which was the lowest since the spread was assessed at $99/mt on December 7, 2012. Demand is still weak, but prices are very high now, the source from Styron said, adding they were aiming to restart the Terneuzen unit next week.

demand was stable and downstream polystyrene demand was stable to strong after price increases were announced for May. In feedstocks, benzene rose 1 cent on the week, assessed at 443 cents/gal FOB USG Friday. Ethylene climbed 3.75 cents week over week to a Friday assessment of 58 cents/lb FD USG.

Asia
Asian styrene monomer prices rose $39/mt week on week to be assessed at $1,651/mt FOB Korea and by the same amount to $1,681/mt CFR China Friday, mainly due to tight prompt supply in China, but unchanged from the previous day. Spot cargo inventory in eastern China has fallen by about 15,000 mt week on week to 60,000 mt, the lowest level heard since January, market sources said Thursday. SM inventory held by traders and end-users in eastern China was estimated at 80,000-90,000 mt, sources said. In Fridays market, market activity among Chinese traders appeared focused mainly on July cargoes, with trades for July-loading cargoes of Asia origin excluding the Middle East and Taiwan, heard done at a range of $1,657-1,662/mt CFR China between Chinese trading companies. There was also talk of a time swap deal done, setting the spread between June and July CFR China cargoes at more than $30/mt. In the prompt domestic market, deals were heard around Yuan 12,700/mt, or roughly about $1,716/mt on an import parity basis. In Southeast Asia, a buyer said it was not easy to find any spot cargoes for June on offer within the region itself as cargoes were either sold out or used in captive production, he said. The buyer added Southeast Asia would likely have to buy at FOB Korea plus freight cost. However, there would likely be spot cargoes on offer in July, a Southeast Asian producer said, adding that this would also depend on prices and SM margins going forward. An Indian market source said offers for European cargoes due to arrive in India within one or two weeks were heard around $1,670-1,675/mt CFR India earlier in the week. However, no deals were confirmed done and the source said the Indian market was dull at the moment. Looking upstream, Asian benzene prices slipped further Friday to be assessed at $1,294/mt FOB Korea, down $0.50/mt from a day earlier and down $4/mt from a week earlier. Ethylene prices were assessed at $1,190/mt CFR Northeast Asia and $1,250/mt CFR Southeast Asia Friday, up $30/mt and $35/mt week on week respectively. The Asian spot market was relatively quiet in the latter half of the week with market participants attending the Asian Petrochemical Industry Conference in Taiwan from Thursday to Friday. At APIC, several sources said they saw the June market as quite crucial for the further development of the SM market this year. This was likely because arbitrage cargoes -- estimated by some at 50,000-60,000 mt or more -- are expected to arrive in June in China. Also, Asian production and supply is expected to have normalized in June with the end of heavy turnaround season in the first half of 2013. However, there was some debate at APIC as to when the bulk of arbitrage shipments from the US will in fact arrive, with some sources saying cargoes might arrive in late June or even July.

United States
US styrene rose 0.85 cent on the week to a Friday assessment at 71 cents/lb FOB USG. Export demand picked up during the week as arbitrage windows from the US to Asia and Europe opened up by week?s end. Three deals were done on the week. A deal for 5,000 mt was done at 70.5 cents/ lb FOB USG for late May loading. Another May loading that was done late Tuesday at 71.5 cents/lb FOB USG for 1,500 mt was reported Wednesday. The 71.5 cents/lb FOB USG deal was headed to China, sources said, with several sources adding that the deal might have been an add-on to another shipment already being sent to Asia. A June deal was reported post-assessment window Thursday at 70.5 cents/lb for 3,000 mt. A source said traders were looking for freight to try to take advantage of the arbitrage, specifically to Asia. A source with a producer said Asia was the better option because the outlook in Europe was bearish. Sources also said Europe was long on product and did not want US material, but as the arbitrage to Europe opened further Friday, a distributor source said, If prices keep going up in Europe, some material will get sent over. With Asian styrene on an FOB Korea basis assessed at $1,646/mt for H2 June and freight around $65/mt, US styrene would need to be below 71.70 cents/lb FOB USG, according to Platts data Friday. However, Asian styrene for H1 July was assessed Friday at $1,630/mt FOB Korea, meaning US styrene would need to be slightly less than 71 cents/lb FOB USG to work the arb, according to Platts data. On a CFR China basis, H2 June was assessed at $1,676/mt, and freight was around $75/ mt Friday, meaning US styrene would need to be less than 72.60 cents/lb FOB USG to work the arb, according to Platts data. European styrene for June was assessed at $1,632/ mt FOB ARA Friday, and freight at $50/mt, so US material would need to be less than 71.75 cents/lb FOB USG to work the arb, according to Platts data. Supply was characterized as tight to balanced this week. Domestic demand was described as steady as downstream acrylonitrile-butadiene-styrene

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Platts Polymerscan

May 15, 2013

Polymer Feedstocks: Intermediates


Purified Terephthalic Acid Polymer Feedstocks Intermediates
Weekly Spot PTA CFR China ($/mt)* PTA CFR SE Asia ($/mt) PTA CFR South Asia ($/mt) EDC EDC EDC EDC VCM VCM VCM VCM CFR FE Asia ($/mt) CFR SE Asia ($/mt) FOB NWE ($/mt) FOB USG ($/mt) CFR FE Asia ($/mt) CFR SE Asia ($/mt) FOB NWE ($/mt) FOB USG ($/mt) CFR FE Asia ($/mt) CFR SE Asia ($/mt) CFR South Asia ($/mt) FOB USG ($/mt) CIF Mediterannean ($/mt) 1047.4-1049.4 1061.0-1063.0 1076.0-1078.0 349-351 349-351 285-290 270-280 789-791 849-851 720-725 665-675 1714-1716** 1699-1701** 1704-1706** 1580-1600** 1670-1675** 931-941 61.57-61.57 42.00-42.50

Europe
European purified terephthalic acid prices remained unchanged this week, following a rollover settlement upstream in PX. The May contract price was initially settled at Eur1,120/ mt ($1,476/mt) FD NWE, market sources said. Consumers believed the settlement was on the high side, considering PX spot pricing in April. Downstream, the PET market gained momentum, sources said, amid a cautious seasonal improvement in demand. As PET imports had been curbed due to uncertainty over price direction, consumers were favoring local production, sources said, as well as increasing offtake. In turn, PET producers mulled the possibility of ramping up run rates. Demand is seasonally strong; it would make sense if resin producers started ramping up rates, a trader said. Meanwhile, a source from Lithuanian PET producer Neogroup said their 300,000 mt Klaipeda plant was currently running at 85%, which compared to just 80% in March, according to the sources previous reports. Elsewhere, a source from Celanese said the company was aiming to achieve a 90-95% rate in the coming months at its 70,000 mt/year Portalegre PET plant in Portugal; currently, the plant was running at 70%. In other news, Spanish PET producer Artenius was in the process of restarting PET production at the larger line of its El Prat 170,000 mt/year facility after a weeklong maintenance, a company source said. The source said the line would be loaded with raw materials Saturday and would see first product by the start of next week.

Acrylonitrile Acrylonitrile Acrylonitrile Acrylonitrile Acrylonitrile

Monthly Contract Price PTA FD NWE (Eur/mt) (Apr ) PTA Delivered USG (/lb)(Apr) VCM Delivered USG (/lb)(May)

US domestic prices reflect transaction pricing for medium-sized customers. * Average prices for week ending previous Friday. ** ACN prices reflect assessments at close of Tuesday

Platts Asian PTA versus Paraxylene ($/mt)


1800 ($/mt) PTA CFR China PX CFR Taiwan 1600

United States
Market sources said May purified terephthalic acid prices could rise, citing an anticipated increase of 3-5 cents/lb for key feedstock paraxylene contract. May PTA and PX contracts both remained unsettled by time of publication. The PX settlement price is the key variable in determining the formula-driven cost of PTA. If the PX contract settles as thought, PTA prices could rise 2-3.5 cents/lb. The US PTA contract was set at 61.57 cents/lb ($1,357/mt) in April, according to market sources. US spot PX prices were assessed Friday at $1,405/mt FOB USG on stronger movements in Asia, a $15/mt increase week on week. Downstream, US polyethylene terephthalate contracts for April were heard settled down 4.5-5 cents/lb, according to market sources, with lower feedstock prices during April helping to push prices lower. US PET demand continued to strengthen, with sources pointing to the combination of lower prices and an increased need for product from US buyers as the spring and summer bottling season continued.

1400

1200

1000 21-Dec

18-Jan

15-Feb

15-Mar

12-Apr

10-May

Notes: All intermediates prices reflect assessments at close of Thursday, with the exception of PTA CFR China.

Asia
The Asian purified terephthalic acid market rose $20/mt week on week to be assessed at $1,057/mt Friday, lifted by strong demand and a rebounding downstream polyester

market. This weeks sales/production ratio was reported at around 100%, which pushed up the CFR China PTA price benchmark. On Friday, a bid and offer range was heard at $1,055-1,060/mt CFR China, higher than $1,040-1,045/ mt Monday. Chinas rebounding polyester market amid summer clothes demand season improved sentiment in the Asian PTA market. According sources in the polyester market, Chinas textile sales hit a one-year high of 9.2 million meter/day late last week, which also reduced polyester filament inventory to around 15 days from 20-30

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Platts Polymerscan

May 15, 2013

days. Polyester filament inventory is coming down, which pushed up PTA feedstock demand since late last week, said a PTA trading source. Considering these, the Asian PTA market will likely be firmer in May compared to April. But some market sources said the rebound might be temporary. Polyester demand season typically ends around July, said another trading source. In addition, Chinese PTA producers may decide to increase their operating rates. But some market participants were skeptical, saying that strong polyester would be short-lived. An Asian PTA producer said: If Chinese PTA producers raise run rates, PTA inventories will be built up very fast. The polyester market is good, but PTA inventory is not very low in China. So I do not think the operating rates will go up quickly. Overall trading activities were limited this week as most market participants were attending the Asia Petrochemical Industry Conference in Taipei. It ended Friday. In plant news, Chinas PetroChina Liaoyang Petrochemical is currently running its 530,000 mt/year No. 2 PTA plant in Liaoyang. The plant was shut briefly late April for maintenance. The companys 350,000 mt/year No. 1 PTA plant remained shut as of early May. Chinas Xianglu Petrochemicals plans to start its 1.5 million mt/year PTA plant in September. The companys initially plans to start the plant in the first quarter of this year were delayed as feedstock supplier Dragon Aromatics was unable to start its PX plant as scheduled in Q1. Dragon Aromatics started test tuns at its 800,000 mt/year PX plant in Fujian on April 22, with commercial operations expected around JuneJuly. Indias JBF Industries has begun construction of a 1.25 million mt/year PTA plant in Mangalore. The $600 million plant is expected to be ready in late 2014.

United States
The US acrylonitrile export assessment dropped $10/mt on the week to a five-month low of $1,590/mt FOB USG Tuesday as supply was heard loosening. It marked the first US ACN export assessment below $1,600/mt FOB USG since it was at $1,550/mt FOB USG on December 11, 2012, according to Platts data. A May deal was heard at $1,580/ mt FOB USG for 2,000 mt. Another deal was done at $1,600/ mt FOB USG for 3,000 mt for late May delivery. Before the deals were heard, sources had talked the market in a range from $1,550-1,600/mt FOB USG this week. A source with a producer said ACN prices could be hitting a bottom if feedstock propylene was at bottom. The May US CGP contract was heard settling down 1 cent to 60.5 cents/lb, but the settlement was not marketwide, sources said. No settlement for PGP was heard. With spot propylene prices rising over the last couple weeks, sources said the June propylene CP could be higher. The April US propylene CP settled down 10 cents from March at 63 cents/lb for PGP and 61.5 cents/lb for CGP, sources said. Despite the deals, ACN demand was described as weak. In production, Ascend Performance Materials restarted the AN 7 unit at its Chocolate Bayou, Texas, facility in early May, sources said. Chocolate Bayou has an estimated ACN production capacity of 1 billion lbs/year.

Asia
Asian acrylonitrile prices fell $15/mt week on week across the region on weak demand, but was curbed by higher feedstock costs and sellers resistance. The CFR Far East Asia marker was assessed Tuesday at $1,715/mt, CFR Southeast Asia marker at $1,700/mt and the CFR South Asia marker at $1,705/mt. Domestic trades in China were at Yuan 12,20012,300/mt Tuesday, or $1,633-1,646/mt on an import parity basis, down Yuan 300/mt from a week earlier. A May shipment of 350 mt traded last week at $1,750/mt CFR China. The transaction was not reflected as Platts assesses cargo sizes of 1,000-2,000 mt for CFR Far East Asia. No firm bids were heard, but notional bids were at $1,650-1,700/ mt CFR China. Sellers were not active in offering as there were no buyers and feedstock costs were higher. Feedstock propylene was assessed at $1,255/mt FOB Korea and at $1,325/mt CFR China Tuesday, both up $10/mt week on week. Ammonia was heard at $600-650/mt CFR Far East Asia. Based on these feedstock prices and a conversion cost of about $100/mt, the breakeven price of ACN should be $1,794-1,871/mt. Notional offers were above $1,750/ mt CFR China. Sources said they expected the bottom to be near as prices have fallen $305/mt since an intra-year high of $2,020/mt CFR Far East Asia on February 26. There is still downward pressure, but the bottom is very close. Maybe rebounding end of this month or early next month, a Southeast Asia end-user said. Some participants were concerned as there was no fundamental improvement in the market. There is no upward trend, and the price trend for June/July is unclear, a producer said. In India, bids were heard at $1,650/mt CFR, while offers were at $1,750/mt CFR.

Acrylonitrile

Europe
Poor underlying demand continued to plague the European continent, sources said this week. In turn, Bluestar Fibres was set to close its Grimsby, UK, carbon fiber precursor plant on poor demand, a company source said Tuesday, although did not give details on timing. We might have short-term ACN demand, but in the long term, we will cease to buy ACN, the source added. In the spot market, a producer reported doing business at $1,720/mt CIF Med last week, adding: We did a couple of deals at that level. However, one trader said they were happy to sell at $1,650/mt CIF in the face of low volume offtake. ACN prices were assessed down $10/mt on the week to $1,670-1,675/mt CIF Med. Meanwhile, bearishness was fueled by the extended price fall in Asia. In addition, sources said the closure of Bluestar Fibres plant had little effect on the spot market as they were a marginal participant. The CFR Far East Asia marker was assessed Tuesday at $1,715/mt, down $15/mt on the week. Meanwhile, in the feedstock market, spot polymer grade propylene values fell during the week to be assessed at Eur980-985/mt CIF NWE Friday, a Eur5/mt fall week on week, on low buying interest. Offtake from key derivatives remained frail.

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An Indian source said there were not many offers and the market looks like it has bottomed out. In plant news, Japans Asahi Kasei plans to restart its 200,000 mt/year ACN plant at Map Ta Phut, Thailand, in mid-June after maintenance, a company source said Tuesday. The plant is currently shut for a one-month turnaround, the source said, without specifying when the plant was shut. The company had earlier planned to shut its plant from mid-May. The plant is operated by a joint venture company, PTT Asahi Chemical, which comprises Thailands state-owned PTT (48.5%), Asahi Kasei Chemicals (48.5%) and Japans Marubeni (3%).

Ethylene Dichloride / Vinyl Chloride Monomer

Europe
EDC: Spot EDC prices remained under downward pressure following the sharp fall in ethylene, while some business was concluded at lower levels week on week, sources said. Spot EDC prices were assessed by Platts Thursday at $285290/mt, down $10/mt from last week, Platts data showed. I think ethylene has weighed a bit on the price, one trade source said. The production of one metric ton of EDC requires 0.29 mt or 290 kg of ethylene. The May ethylene contract price has fallen Eur100/mt from Aprils contract value, so the price of EDC could fall by up to Eur29/mt in order to reflect this drop. So far, it has declined Eur15/ mt since the beginning of May. Meanwhile, some EDC spot business was concluded this week at lower levels than Platts previous assessment on May 2 of $295-300/mt, the trade source said, but he could not confirm the price levels or disclose names of the parties involved at time of press. In Asia, ethylene dichloride prices were flat for the third consecutive week at $350/mt CFR Far East Asia and $350/mt CFR Southeast Asia Thursday as buyers hesitated to increase bids despite firmer upstream ethylene and downstream PVC market sentiment. VCM: The northwest European VCM spot market was inactive as no spot trades were reported this week, according to sources. The spot price was assessed unchanged by Platts at $720-725/mt. Sources said VCM would remain inactive and that EDC would also stay quiet until a sustained period of demand for PVC. I have not seen anything happen yet. If there was a few weeks of it [healthy PVC demand], something might happen, the first trade source said, noting that most global trade routes for EDC and VCM were quiet, except for flows of US product to Asia, and added: There is a fair amount of material heading west, rather than east to go to Asia. In Asia, VCM prices were unchanged week on week at $790/mt CFR Far East Asia and $850/mt CFR Southeast Asia Thursday. Meanwhile, one Chinese end-user bought an end-May arrival cargo at $790/ mt CFR China.

Spot EDC buying bids were heard in the range of $320330 CFR China. Buyers are trying to see if anyone has any product to give away at that price, a trader source said. Upstream, ethylene was assessed Thursday at 57.7558.25 cents/lb FD USG, up 4 cents week on week, as talks of ethylene contracts were reportedly at a stand-still with at least one large buyer expecting a 1-cent decrease for April, and at least one major producer expecting a rollover from Marchs net transaction price of 48 cents/lb ($1,058/ mt). Chlorine was steady week on week, assessed Tuesday at $195-205/st FOB plan. Globally, Asian EDC prices were unchanged at $350/mt for both CFR Southeast Asia and CFR Far East Asia assessments, despite a $30/mt increase in ethylene feedstock cost. VCM: US vinyl chloride monomer was up $10/mt week on week, assessed at $665-$675/mt FOB USG Thursday, as downstream prices moved higher. No VCM spot bids, offers or trades were reported by the close of assessment. In PVC markets, export prices were up $20/mt week on week, assessed Wednesday at $885-895/ mt FAS Houston, as buying interest was heard significantly increasing. In production, Axiall was expected to undergo VCM plant turnarounds in the next couple of quarters, according to companys first-quarter conference call. The outages are more of the planned type going forward. And so they were built into our plans related to operating rates. And I guess the other thing is, particularly on VCM as an example, we have significant capacity more than what we need for a PVC point of view. So all thats planned out, President and CEO Paul Carrico said Wednesday. Specifics on duration and location of the turnarounds were not disclosed in the call. Oxy Vinyls reported release of EDC and VCM because of an incinerator trip at its Deer Park, Texas, facility on Wednesday, according to a company filing with the National Response Center. The leak was of about 100 lbs, the facility is fully operational and we are treating this as a non-issue, a source familiar with company operations said.

Asia
EDC: Asian ethylene dichloride prices were flat for the third consecutive week at $350/mt CFR Far East Asia and $350/mt CFR Southeast Asia Thursday as buyers hesitated to increase bids despite firmer upstream ethylene and downstream PVC market sentiment. No deals were concluded this week, with bids and offers unchanged from a week earlier. Bids were in the low $300s/mt CFR China, while offers were above $350/ mt CFR China. [There is] not much change from a month ago, a trader said. Upstream ethylene prices rose $30/mt week on week to $1,190/mt CFR Northeast Asia Thursday. In Southeast Asia, buyers have no spot EDC requirements as they have sufficient inventory. VCM: Vinyl chloride monomer prices were unchanged week on week at $790/mt CFR Far East Asia and $850/mt CFR Southeast Asia Thursday. A Chinese end-user bought an end-May arrival cargo at $790/ mt CFR China. Offers were over $800/mt CFR China, while bids were at $760-770/mt CFR China, a Japanese trader said. Discussion for June arrival cargoes has yet to start as the

United States
EDC: The US ethylene dichloride assessment was steady week on week, assessed Thursday at $270-280/mt FOB USG, in quiet markets as spot offers or trades were not reported.

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price trend for downtrend PVC remained difficult to discern, sources said. Asian PVC prices in China and Southeast Asia were assessed at $955/mt CFR and $960/mt CFR, respectively, Wednesday, flat and up $10/mt from last Tuesday. Sentiment was firmer this week on expectations that prices had hit bottom. Several PVC market participants said Formosas June PVC offer would likely be $10-20/mt higher than the previous month, reinforced by tighter supply due to turnarounds in Japan and recovering demand. In Southeast Asia, no deals were heard, with little buying interest seen for May cargoes. In market news, Solvay and Ineos have signed a letter of intent to merge their European chlorvinyls businesses, creating one of the worlds top three PVC producers, Solvay said Tuesday. The two companies will set up a 50:50 joint venture that will pool each companys assets across the entire chlorvinyls chain. This includes PVC, caustic soda and chlorine derivatives. The joint venture will improve the competitiveness of its operations in a very challenging environment regarding feedstock and energy costs in Europe, said Solvay CEO Jean-Pierre Clamadieu. Solvays main contribution to the JV will be its vinyls business that consists of Solvin -- a joint venture between Solvay (75%) and BASF (25%) -- and its chlor chemicals business. UK-based privately held Kerling Plc., owner of Ineos ChlorVinyls, will contribute its chlorvinyls and related business units. Kerling Plc owns chlor-vinyl facilities across Europe, focused mainly on VCM and PVC production. In total, its PVC capacity is currently around 1.5 million mt/year and its VCM capacity around 1.9 million mt/year.

to industry sources. With less butane blended into gasoline during the summer, many refineries are now exporting more butane, most of which is moved around Northwest Europe as coaster cargoes. Such cargoes are generally between 1,000 and 3,000 mt in size. Providing the CIF butane price is below the CIF naphtha price, some of this surplus butane can be absorbed into the petrochemicals sector as an alternative feedstock to naphtha. The CIF butane/CIF naphtha price ratio was just over 85% at the beginning of May, but since then has steadily fallen to reach a last published level Tuesday of 79.2%, based on Platts data. Industry sources said that one reason for this decrease was reduced demand from the petrochemical sector with two petchem butane users reported to be largely covered over the second half of this month. Another contributory factor has been the good levels of coaster butane supply with a number of refineries exporting cargoes on a regular basis. It is a fairly busy market, said one industry source.

US ethanol days of supply at record low, stocks at 29-month low: EIA


Houston The weekly US ethanol days of supply fell 0.7 day to 19.4 days of supply for the reporting week ended Friday, the lowest recorded level by the Energy Information Administration, as weekly ethanol stocks plunged 418,000 barrels to a 29-month low of 16.429 million barrels, the EIA said Wednesday. The ethanol days of supply calculated by dividing weekly ethanol stock levels by the weekly refiner and blender ethanol net input fell to a record low as the weekly refiner and blender ethanol net input edged up 8,000 b/d to a four-week high of 846,000 b/d. The EIA started tracking ethanol inventories in the reporting week ended June 4, 2010. The previous record low for the weekly ethanol days of supply was 19.8 in the reporting week ended October 15, 2010. The sizable drop in weekly ethanol stocks the third week of declines in a row to the lowest level since the reporting week ended December 3, 2010, when they were at 16.384 million barrels was on considerable stock draws in the East Coast, Gulf Coast and Rocky Mountain region. East Coast ethanol stocks shrank 163,000 barrels to its own record low of 5.514 million barrels. The previous low was at 5.597 million barrels in the reporting week ended April 26. Gulf Coast ethanol stocks were on a three-week descent as they plunged 290,000 barrels to a six-week low of 2.363 million barrels. Ethanol stocks in the Rocky Mountain region edged down 10,000 barrels to 350,000 barrels. Midwest ethanol stocks, on the other hand, edged up 13,000 barrels to 5.977 million barrels as West Coast ethanol stocks grew 33,000 barrels to a three-week high of 2.225 million barrels. Weekly ethanol production erased the previous weeks drop as it rose 14,000 b/d to 857,000 b/d. There were still no ethanol imports reported in the latest week. The last time ethanol imports were

News

S Koreas benzene exports fall in Apr to 128,232 mt, down 14% from Mar
Singapore South Koreas benzene exports plunged 14% from March to 128,232 mt in April, customs data released Friday showed. This was primarily due to the closed AsiaUS benzene arbitrage since late January. The US benzene arbitrage is still shut on paper, with the Asia-US benzene spread at minus $50/mt Tuesday and freight from Asia to the US estimated at $62-67/mt. In addition, the turnaround season of aromatics plants in Asia resulted in fewer exports from the region. Asian traders sought to divert some of their cargoes to China and Taiwan on the back of reduced supply. South Koreas GS Caltex shut its No. 2 aromatics plant at Yeosu on March 16 for 30-day maintenance while S-Oil also shut its No. 2 aromatics plant in Onsan in mid-April for a 36-day turnaround, Platts reported earlier.

NWE coaster butane prices weaken against naphtha on good supply, weaker demand
London Spot prices for delivered coaster cargoes of butane in Northwest Europe have weakened against naphtha on good supply and weaker demand, according

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recorded was in the reporting week ended April 19, when they were at 39,000 b/d. The weekly overall amount of gasoline produced jumped 256,000 b/d to a threeweek high of 8.929 million b/d. The weekly amount of gasoline blended with ethanol increased 90,000 b/d to 8.486 million b/d, the highest level since the reporting week ended August 10, when it was at 8.487 million b/d. As the gain in the weekly overall amount of gasoline produced outpaced that of the weekly amount of gasoline blended with ethanol, the weekly ethanol blending percentage eased off of the previous weeks record high, shedding 1.8 percentage points to a three-week low of 95%. The amount of gasoline blended with ethanol is calculated by adding the volume of reformulated gasoline blended with ethanol and conventional gasoline blended with ethanol. The ethanol blending percentage is calculated by dividing the weekly amount of gasoline blended with ethanol by weekly total gasoline production. The four-week rolling average of gasoline demand moved down 10,000 b/d to a four-week low of 8.488 million b/d, 3.1% below where it was at this time last year. Year to date, current-year levels were 0.1% higher than 2012. As the four-week rolling average of the refiner and blender net ethanol input slid 2,000 b/d to a three-week low of 839,000 b/d, the four-week rolling average of the ethanol blending rate calculated by dividing the four-week rolling average of the weekly refiner and blender net ethanol input by the four-week rolling average of gasoline demand nudged down 0.02 percentage point to a three-week low of 9.88%, 0.12 percentage point away from the 10% blend wall. Currently, most non-flex-fuel vehicles are allowed to run E10, or a 10% ethanol-gasoline mix. Some model years also are Environmental Protection Agency-

approved to run E15. The blend wall, which some observers think could be hit this year, describes when the maximum amount of the US gasoline pool has been blended with 10% ethanol. Refiners then will be under pressure to run higher ethanol blends, buy renewable credits known as RINs, or push for Congress to alter the Renewable Fuel Standard.

European xylenes continue to strengthen as offers rise on firmer US, gasoline


London Northwest European xylene prices continued to strengthen this week, with offers climbing to as high as $1,260/mt, influenced by the rise in US prices and demand for gasoline, sources said Wednesday. The US spot mixed xylenes market reached a two-month high Tuesday to be assessed at $4.21/gal ($1,279.84/ mt) FOB US Gulf Coast. In Europe, spot prices rose $20/ mt to be assessed at $1,235/mt FOB ARA on Friday May 10, with the market notionally pegged this week at $1,230-1,260/mt FOB ARA. Offers were heard as high as $1,280/mt. No deals were reported done so far this week In addition, market sources pointed to the low refinery/cracker runs as one factor influencing the higher reformate, xylene prices seen in Europe. Runs of 73%78% are low, really low, a trader said Wednesday. Rates in the Mediterranean had been cut recently, while some crackers and refineries were in turnaround in the second quarter, traders said. This happening in a period of weak demand from the chemical chain. Despite this weak demand in Europe, sources pointed to rising US prices as providing some support, while good reformate and xylenes demand going into the gasoline pool have also supported the market. This sentiment was supported by a

Global Production Update


Company Location Formosa Point Comfort, Texas Braskem Alagoas Westlake Geismar Axiall Plaquemine, Louisiana Shintech Freeport, Texas Formosa Point Comfort, Texas Formosa Baton Rouge, Louisiana Oxy Pasadena, Texas Shintech Addis, Louisiana Oxy Pasadena, Texas Oxy Pasadena, Texas Shin-Etsu Botlek Shin-Etsu Kashima Sinopec Qilu Shandong Taiyo Vinyl Yokkaichi Taiyo Vinyl Osaka Taiyo Vinyl Chiba RIL Hazira RIL Hazira Asahimas Anyer Capacity* Timing kt/yr 575 PVC Jun-13 460 PVC May-13 300 PVC Mar-13 1,600 PVC Mar-13 3,000 PVC end Feb 2013 575 PVC Jan-Feb 2013 790 VCM Jan-Feb 2013 950 PVC mid-Dec 300 PVC 1-Nov 950 PVC Sep 950 PVC Sep 620 VCM 15-Oct 550 PVC 600 PVC 310 PVC 170 PVC 90 PVC 360 PVC 360 PVC 300 PVC Status TA 2-3 weeks TA 10 days FM ends 3-13-13 TA mid-March - 3 weeks TA late Feb - 3 weeks TA late Jan- 3 weeks TA late Jan- 3 weeks SU TA 3 weeks TA moved to H2 Oct TA starts H2 Sep 2 weeks, reduced OR TA from week May 20, 1 month TA Apr 1, one month TA Mar 23 to Apr 20 OR 60-70% OR 100% RS Mar 17, OR 100% RS Mar 14/15 after SD! Since Mar 4 OR 70% after power outage

TA = scheduled turnaround; SD! = unplanned shutdown; SU = startup; DB = debottlenecking; OR = operating rate

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second European trader here: There is no demand in the [US] Gulf, its just for blending, the second trader said. Reformate premiums to EBOB barges have risen in recent weeks, heard pegged at around $40-50/mt. Its quite clear that without the Chinese demand they would be lower, a trader said, referring to the premiums. Xylene is extracted from reformate in the refining process. Spot xylene prices in the US have risen 18 cents since the May 1 assessment of 403 cents/gal FOB USGC or $1,225/ mt FOB USGC. Despite the strong rise in the US market,

European sources said that demand for export was thin and no buyers had sought volumes for export because there was little available for prompt loading. Prompt [supply] in second-half May; yes its tight [so] no export to US, the second trader said. In the Platts Market On Close assessment process on Friday, Stasco bid isomer MX at $1,230/mt for any-May dates. The bid remained unanswered by the close, and one source said the bid would need to be around $1,250/mt before it could enact any sell interest.

POLYMERSCAN

Volume 36 / Issue 20 / May 15, 2013

Editorial: Sydney +61-2-9255-9842. Singapore +65-6530-6584. Tokyo +81-3-4550-8837. London +44-20-7176-6264. New York +1-212-904-3070. Houston +1-713-658-3206. Client services information: North America: 800-PLATTS8 (800-752-8878); direct: +1-212-904-3070 Europe & Middle East: +44-20-7176-6111 Asian Pacific: +65-6530-6430 Latin America: +54-11-4121-4810, E-mail: support@platts.com Copyright 2013 McGraw Hill Financial. All rights reserved. No portion of this publication may be photocopied, reproduced, retransmitted, put into a computer system or otherwise redistributed without prior written authorization from Platts. Platts is a trademark of McGraw Hill Financial. Information has been obtained from sources believed reliable. However, because of the possibility of human or mechanical error by sources, McGraw Hill Financial or others, McGraw Hill Financial does not guarantee the accuracy, adequacy or completeness of any such information and is not responsible for any errors or omissions or for results obtained from use of such information. See back of publication invoice for complete terms and conditions.

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