Northwest European polyethylene terephthalate producers and converters say they have settled their December contract prices with a rise of between Eur70/mt ($92/mt) and Eur86/mt -- just above full pass-through costs of Eur83/mt.
Significant increases in the December contract price for PET feed stocks are cited as the primary cause of the cost increase.
The paraxylene December contract price rose Eur102/mt to Eur1,030/mt, the second consecutive triple digit increase in the NWE PX contract market. Monoethylene glycol December contract prices also increased, climbing Eur70/mt to Eur975/mt.
One PET converter said it completed December contract negotiations with its two main suppliers with an increase of Eur86/mt, the highest rise reported to Platts.
"While resin is still in short supply and suppliers margins have increased, prices are moving in line with raw [materials]," the converter said. He declined to give a net or gross contract price.
Other converters and producers said the increase was slightly below pass through costs.
"Everything we've accepted so far is around plus Eur75/mt. For some contracts we had to pay a little more, but the maximum would be pass-through costs," a second converter said. He also declined to give a net or contract price, but did say spot prices for PET were higher than contract prices.
"We don't buy spot at the moment because spot is too high," he said.
A PET producer agreed that spot prices were higher in December compared with the contract prices, and that is attributed to structural changes in the raw material chain for PET.
"I think the real price driver in the market is the raw materials and not the PET demand," the producer said. "Demand is substantially normal for the season," he added.
He reported December contracts settling with a wide range, between Eur1,245-1,315/mt FD net, with the average net contract for Europe at Eur1,270/mt FD.
A third converter agreed that PET contracts for NWE in December rose Eur70/mt, to a delivered net price around Eur1,270/mt. Another PET producer said he settled December net contract prices between Eur1,260-1,270/mt.
--Kimberly Peterson
Significant increases in the December contract price for PET feed stocks are cited as the primary cause of the cost increase.
The paraxylene December contract price rose Eur102/mt to Eur1,030/mt, the second consecutive triple digit increase in the NWE PX contract market. Monoethylene glycol December contract prices also increased, climbing Eur70/mt to Eur975/mt.
One PET converter said it completed December contract negotiations with its two main suppliers with an increase of Eur86/mt, the highest rise reported to Platts.
"While resin is still in short supply and suppliers margins have increased, prices are moving in line with raw [materials]," the converter said. He declined to give a net or gross contract price.
Other converters and producers said the increase was slightly below pass through costs.
"Everything we've accepted so far is around plus Eur75/mt. For some contracts we had to pay a little more, but the maximum would be pass-through costs," a second converter said. He also declined to give a net or contract price, but did say spot prices for PET were higher than contract prices.
"We don't buy spot at the moment because spot is too high," he said.
A PET producer agreed that spot prices were higher in December compared with the contract prices, and that is attributed to structural changes in the raw material chain for PET.
"I think the real price driver in the market is the raw materials and not the PET demand," the producer said. "Demand is substantially normal for the season," he added.
He reported December contracts settling with a wide range, between Eur1,245-1,315/mt FD net, with the average net contract for Europe at Eur1,270/mt FD.
A third converter agreed that PET contracts for NWE in December rose Eur70/mt, to a delivered net price around Eur1,270/mt. Another PET producer said he settled December net contract prices between Eur1,260-1,270/mt.
--Kimberly Peterson
