In September, the market for glass fibre reinforced composites was mostly quiet, with prices at a high level. Manufacturers of standard products (medium-reactive ortho resins) operating with numbers near the bottom of the scale for the most part raised their numbers to match the general price level. Bargains were rare. From the producers’ viewpoint, the EUR 33/t rise in the price of styrene monomer (SM) and the substantial increase in maleic acid anhydride prices that took place in Q3 left little scope for negotiation, despite the recent EUR 10/t decline in the propylene contract.

Converters had reasoned – in vain – that falling notations for other starting materials such as the phthalic anhydride precursor orthoxylene should push resins prices downward. Nevertheless, they plan to fight for a reduction in October, not least because the monthly SM price was fixed – shortly before press time – EUR 13/t lower against September. “The resin price in no way reflects the feedstock situation,” one player commented to Plasteurope.com. Supply crunches are also evident for specialty additives such as the flame retardant aluminium trihydroxide.

Notations for lower quality glass fibre gained more ground than higher value-added mats or rovings in September. This was due undoubtedly to the EU’s planned anti-dumping measures for Chinese glass fibre that are expected to make these imports scarcer and more expensive. The first antidumping-related price increases are likely to be seen in Europe this month. The 5-7% hike planned by a leading European producer in Q4 will set the pace for the market in general. Nevertheless, the beginning of 2011 will surely see further steps upward.

Demand in September returned to the high level prevailing before the summer holiday period. The commercial vehicle market was booming, as was the building sector ahead of its winter break. The automotive sector was another driving force, as reflected in higher registration figures for new vehicles. Orders from the energy sector for insulators, power switches and other products lost some ground.

Change September against August: Up EUR 15/t
The EUR 33/t rise in the SM contract provided no particular impetus for upward price movements in September, and the EUR 10/t downslide for propylene was too weak to push notations downward, especially as the third-quarter fixings for glycol and maleic acid anhydride provided a counterweight. The slight increase in notations at the upper end of the Plasteurope.com range was due more to seasonal fluctuations than to a real trend toward recovery.

Supply: Balanced. Despite the continued strong demand, ortho resins were, without exception, in good supply. Producers were able to meet delivery dates promptly and in full, although this required considerable effort after output levels dipped in summer.

Demand: Good. Order activity continued at a high level during the summer holiday month of August. Automobile production already had begun to gather momentum in early summer, and the commercial vehicle segment began seeing slight and later strong upward movement after the end to the vacation season. Similar trends were seen in the building, energy and E&E market segments. The lighting segment was somewhat more sluggish, despite the start to the peak winter season.

Outlook for October: Rumour has it that additional spot material will be in the market in the second half of this month, although it is unclear where this would come from, as producers’ capacities are well utilised. One possibility is that at least one converter has cancelled orders placed with major resins producers, and this could create slight downward pressure on prices. The EUR 13/t slip in the SM price and the EUR 10/t setback for propylene in October could provide some relief for producers. It remains to be seen, however, to what extent they will pass this benefit down the chain. Large chunks of the GRP industry are reporting full order books. Following similar developments in North America, prices for higher value-added vinyl ester resins are expected to see increases in Europe in October or in November at the latest.

Change September against August: Unchanged to up EUR 50/t
As widely expected, prices for lower quality chopped strand mats saw a relatively substantial upward thrust last month in response to the EU’s antidumping tariffs on Chinese imports. Some higher-end products also saw – in many cases substantial – increases, for the most part at the upper end of the range, but this was not the case generally, however.

Supply: Balanced to tight. The absence of Chinese material was already evident here and there. Distributors and converters reported delivery delays ranging up to a week, in some instances longer. Some products were even short. This trend is likely to become even more pronounced in December and into January 2011, as most converters will try to nail down supplies. Chopped strands were especially affected by the developments in September.

Demand: Strong. Order activity in some cases exceeded pre-vacation levels. Alongside the automotive and E&E segments, building applications ordered well, ahead of the winter break.

Outlook for October: One large European glass fibre producer pressed ahead with plans to lift prices for chopped strand mats and direct rovings by 5-7%. Other players are expected to follow suit with delay. The upward price momentum, seen in some cases before the EU announced its antidumping plans against Chinese products, will continue, although it is not clear to what extent European buyers will feel the pressure. The price negotiations in late October and early November will surely set the stage for further increases in 2011.

Change September against August: Up EUR 15/t
Unexpectedly, the entire range saw slight gains in September, after registering little price movement in earlier months. A significant upswing was seen at the upper end of the range and for higher quality products.

Supply: Balanced to tight. For large orders, the diminished availability led to delayed deliveries. Some converters are said to have taken delivery in tranches to keep production humming.

Demand: Good. In addition to the market segments mentioned earlier, orders for pultruded profiles used in building applications continued strong. The sheet sector also performed well, in line with expectations.

Outlook for October: Like chopped strand mats, direct rovings will not be exempted from major European producers’ plans to increase prices. Depending on the product, prices are likely to rise by 5-7% if all market players follow the leaders. Here, too, notations already are being influenced by the EU antidumping tariffs on Chinese imports, and no relief is in sight. For 2011, further sharp rises can be expected.

Prices Composites in EUR/t
Components	September				August 2010
Unsaturated Polyester Resins
Ortho Resins (medium reactive)	1,510	-	1,680		1,500	-	1,660
Chopped Strand Mats
standard (≥30)	1,500	-	1,630		1,450	-	1,580
Sheets / Automotive (<30)	1,800	-	2,200		1,800	-	2,200
Direkt Rovings
standard (≥2.400 tex)	1,040	-	1,230		1,020	-	1,220
Prices listed above were obtained by Plasteurope.com in consultation with plastics converters, producers, distributors and other merchants. Data without guarantee. Compiled: 30 September 2010.

The research on composite prices is conducted in cooperation with AVK - the German
Federation of Reinforced Plastics, Frankfurt / Germany – http://www.avk-tv.de/