Urethane Blog
European Polyol Update
March 3, 2023
European Polyol Prices are Decreasing Amid Weak Demand and Stock Replenishment
- 01-Mar-2023 3:11 PM
- Journalist: Peter Schmidt
As per the data sources, Polyol prices have consistently decreased in the European region from the beginning of 2023. In February 2023, Polyol prices decreased by almost 3.2% from the previous month’s discussions. At the end of the week, which concluded on February 24, 2023, Polyether Polyol prices in Germany and the United Kingdom settled at USD 2800/MT and USD 2880/MT, respectively.
The key reason for this decline in Polyol prices is the stock replenishment amid fallen offtakes from the downstream Polyurethane producers due to weak orders for the Polyurethane foam from the domestic manufacturing sector for furniture and automotive seats. According to the data sources of the Federal Motor Transport Authority, car registrations fell by 43% in the European region in February 2023.
Previously during the Q4 of 2022, most of the Polyol supplies were imported from the Asian region amid plant shutdowns by producers because of high input costs in Europe due to a spike in Natural Gas prices.
The Polyol’s input costs have decreased significantly in the region, especially from the beginning of 2023, due to a reduction in Dutch TTF and the United Kingdom’s NBP Natural Gas futures on the back of LNG’s stock replenishment because of mild weather than anticipated, further reducing the variable costs.
On the contrary, prices of Propylene Oxide, a key feedstock of Polyol, rose slightly during the past few weeks in the European region due to the spike in upstream Naphtha prices because of the recent ban and sanctions on Russian products from February 5, which increased the cost pressure.
As per the ChemAnalyst estimation, “Polyol price trend is likely to remain weak in March due to sufficient availability of product supplies. At the same time, various plants in the region are going for maintenance shutdown, including Toluene Diisocyanate plants, indicating sufficient availability of Polyurethane components.
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