Polish polyolefin market tight

Polish polyolefin market tight

PE and PP supply has tightened in the Polish market this week. It was nearly impossible to get the material from polyolefin producers for two weeks prior to this one, and now it is getting increasingly more difficult to buy it from traders as well. "Polyolefins are running out of stock" -  a market player has informed. Off-spec grades are also in short supply.

Fears of the commodity appreciation and the shortage exacerbation in September have resulted in panic buying by converters. According to sellers, PE is more popular than PP now, although the latter is also in demand.

HDPE and LDPE is most often bought by industrial film and pipe producers and consumer packaging suppliers. "The situation in the construction sector has improved somewhat compared with recent months. However, the overall situation remains difficult. According to our data, 30% of construction firms have started laying off staff or have gone bankrupt this year" - a Polish trader has commented.

Prices have been unchanged. However, the traders that still have the goods on hands are offering them at a premium of €20 - 30/t. Due to the restocking boom in August, the first weeks of September may be less active than usual. "Only those who did not built inventories this month will be buying next one" - a trader has predicted.

Producers will attempt at raising polyolefin prices at least to or even above the levels traders are quoting now, putting them €30 - 40/t up (€100 - 120/t in total). Producers may allocate larger quantities for spot sales to meet demand from traders. Some players think that it will be the quantities that are currently available from producers but :waiting for better margins". The new Polish PP producer Polimery Police may enter the market as early as the beginning September. The availability of off-spec materials will improve only in three to four weeks.


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