FACTBOX: Summer breaks hit European petrochemical markets as trade curtailed

New York — With many downstream consumers out on holiday, European petrochemical activity in the past week has been curtailed with signs this will intensify further during the first weeks of August.

All eyes remain on the settling of August contract prices with many due to settle in the coming days. The butadiene contract price for August was one of the first to settle, climbing Eur35/mt and providing some direction to other cracker products. Meanwhile, markets in Turkey, the Middle East, and North Africa look set to see near-zero activity in the coming days as the Islamic world celebrates the Eid al-Adha religious festival.

The following are the latest key facts affecting the European petrochemical and consumer goods markets:

PRICES

**Spot prices in the European methanol market continued their upward trend and hit a 19-week high on July 29 amid lower global operating rates and improving demand in Europe.

**Turkish markets continue to be pressured by the plunging lira, adding challenges for importers.

**Turkish and Iranian EPS is expected to land in Europe in September, pressuring prices.

**European PE producers see July margin compression for the first time in 2020 as feedstock costs outstrip demand and supply chains stabilize.

**European PVC spot price stood higher by more than 16% July 29, when compared with post-pandemic bottom levels in May.

**NWE Q3 caustic soda contract prices finalized at decreases in key domestic markets, as oversupply adds pressure.

**Spot butadiene availability remains tight as producers continue to manage systems amid stable domestic demand downstream. Export prices climbed to the highest level since May.

INFRASTRUCTURE AND TRADE FLOWS

**The European vinyl acetate monomer market will be keeping an eye on imports as only around 16,000 mt are left before the free quota is depleted, according to the European Commission taxation and customs union data. Sources said imports from Asia were likely to fall as a result.

**Middle Eastern benzene exports caught between long supply in Europe and Asia, low demand in US

**The European styrene market faces 40,000-50,000 mt of US imports landing late-July, early-August

**INEOS Styrolution Antwerp turnaround due from September 1 for six weeks

**Turkish polymer markets expected to remain quiet until next week following Eid holiday and European CP settlements

**SBR activity limited with downstream consumers on holiday across continent

**Eid-al-Adha holiday across the Islamic world sees participants retreat from market until August 4

**PVC producers in Europe will refocus on the revived domestic market going into August, while continuing to build up their stocks

**Propylene market is further tightening, as lighter cracking and lower refinery rates limit output

**VAM imports to Europe from the Middle East and Asia remain slow, a source said, with around 22,500 mt remaining on duty-free basis before the quota is depleted, according to the European Commission taxation and customs union data.