The Urethane Blog

European Feedstock Update

EMEA: The week ahead in petrochemicals, w/c Mar 19

London (Platts)–19 Mar 2018 840 am EDT/1240 GMT


The European ethylene spot market is tight as turnaround season begins.


There are reports of an uptick in the volume of deals being done but with discounts close to flat on the contract price, European inventory is expected to remain snug in the coming weeks.

Propylene prices look bullish going in to April as market remains fairly tight with US imports into Europe no longer looking likely.

The European butadiene market continues to see upward price pressure, as opportunities in export markets persist.

The direction of export spot prices is expected to continue to drive movements in the domestic spot market in the coming days.


Europe’s polyethylene market is experiencing a period of sustained bearishness, with price pressure on weak demand and abundant supplies expected to continue.

Sentiment in the tightest of the polyethylene markets, HDPE, is also turning bearish, with fears price pressure in Asia could now lead to further supplies arriving into Europe in the coming weeks.

Polypropylene prices remain bearish following the recent drop in the propylene contract price, but availability remains tight following recent production issues.


Sentiment is expected to remain bearish in the European styrene market amid weak fundamentals globally.

PS and ABS demand have been heard muted as buyers predict lower prices in April in light of lower styrene prices so far in March. Import pressure has also been seen for both PS and ABS.

As for styrene feedstock benzene, prices could find support heading into April as European and US styrene producers restart plants following first-quarter turnarounds.

Whereas benzene demand could pick up in the near term, it could take a week or two to clear out supply length in Europe before increased demand is reflected in prices.

Toluene and mixed xylenes remain depressed, as exports from Europe to the US Gulf Coast are no longer seen feasible due to the backwardated structure in the US market.

Chemical demand for either product will remain mediocre at best.


Methanol prices in Europe continue to seesaw, with no significant market trend in recent weeks.

Supplies in Rotterdam are said to be tight, but most attention in the market is now focused on quarterly contract negotiations as opposed to spot deals.

MTBE demand in Europe remains largely centered around storage plays, given a slight contango in the gasoline market and a currently well supplied summer grade gasoline market.


Market participants will continue to eye drastically low supply and inventory levels in global AA and VAM markets as major producers in US, Asia and Europe are either experiencing production issues or are on planned turnarounds.

The situation is not forecast to improve in the coming week.


In European SBR, prices are forecast to continue rising amid March feedstock butadiene and styrene contract price increases.

Demand remains solid against a relatively upbeat economic situation in the region.

Limited export opportunities to Asia due to competitive natural rubber prices could pressure prices though.


Supplies in Europe are abundant, with demand having cooled off at the end of Winter. There is speculation prices will rise with an expected increase in PET demand in the coming weeks.

–Thordur Gunnarsson,

–Edited by Jonathan Fox,