European converters have resorted to using off-prime grades of linear low density polyethylene C6, C8 and metallocene due to tight supplies and the high price of prime LLDPE C4, industry sources said this week.
Prompt supplies for most PE grades remained tight because of a spate of production issues and cracker turnarounds. An import market driven LLDPE C4 market was additionally affected by delay in deliveries for the Middle East.
Four steam crackers combining 2.67 million mt of ethylene capacity are in maintenance from August-October: Total Petrochemicals and Ineos' Naphtachimie steam cracker at Lavera, in southern France; LyondellBasell's Wesseling cracker in Germany; Borealis' Porvoo steam cracker in Finland, and the Shell and ExxonMobil jointly owned ethane cracker at Mossmoran in Scotland.
Some PE formulations are flexible enough to allow the replacement of LLDPE C4 with other LLDPE grades, sources said. Generally, prime grades of LLDPE C4, C6 and metallocene price at a premium to LLDPE C4 and do not allow for an efficient substitution because of the greater degree of film toughness, processability and clarity, sources added. However, near-to-prime grades of high alpha olefins, made from C6 or higher building blocks were alternatives to LLDPE C4.
"We have resorted to buying off prime LLDPE C6, C8 and metallocene as a substitute as we don't want to pay high prices," a converter said, adding that he had purchased LLDPE C8 at Eur1,380/mt FD NWE.
Market participants said that source grades of LLDPE C4 were particularly tight like Melt 1 without additives, while others were more easily available like Melt 2. LLDPE C4 spot prices moved sideways this week at Eur1,390-1,395/mt FD NWE.
