European polyethylene prices have fallen in the run-up to the K Fair international plastics and rubber trade fair in Dusseldorf, on the back of volatile upstream prices and robust supplies which kept buying hesitant, sources said.
Low density polyethylene spot prices were down Eur10/mt ($13.53) on the day at Eur1,272.50/mt Tuesday. This represents an erosion of Eur40/mt week on week.
Prices of feedstock naphtha were assessed at $915.5/mt CIF NWE Tuesday, up $17.25/mt on the week. Naphtha prices fell below the psychological mark of $900/mt earlier in the month, but have recovered since last week.
"It feels like we are going to go off a cliff in terms of prices," one converter said, adding that he has a couple of offers for LDPE at Eur1,250/mt FD NWE.
"Demand is really flat. Prices at Eur1,250-1,280/mt FD NWE are the new normal," a trader said.
Sources said it was liquidation from the traders and distributors rather than the producers that was adding to the supply pressure in the market. UK spot prices were pegged at GBP1,080-1,100/mt ($1,732-1,764/mt) FD.
"European producers are going to lose out this month, they won't be able to hold out prices," another trader said, adding that sub-prime offers were heard in the mid GBP1,000s/mt FD in the UK.
"End-user demand is a bit quiet as there is some pressure on prices so our customers are withholding orders. We have only orders booked 10-12 days forward. August was a good month, but since than the order books have faltered," one converter said.
"Quite a lot customers are waiting to put orders in as they have stocks waiting," a trader said, pegging prices at Eur1,270-1,280/mt FD NWE.
