Rotterdam (The Netherlands): In the last few weeks, the market for Diisononyl Phthalate (DINP) experienced a modest price increase to USD 1672 per metric ton (MT), reflecting a rise of USD 25/MT or 1.6%. This upward trend, although slower compared to previous periods, can be attributed to several factors. Despite lower overall demand and price deflation on a year-over-year basis, regional PVC markets rebounded from a three-year low, helping to stabilize and elevate DINP prices. Market participants, however, remain cautious, as the current conditions do not support significant margin recovery. Consequently, DINP suppliers are reducing new orders for June, anticipating weaker sales due to subdued activity in the construction and automotive sectors.

In Italy, the domestic demand for plasticized PVC remains stable, bolstered by ongoing civil works and construction projects initiated by the Meloni government. Nonetheless, domestic supply faces stiff competition from U.S.-based suppliers offering lower prices by EUR 25-40/MT. The supply situation for DINP is characterized as moderate, with several suppliers delaying new offers due to a lingering holiday lull and delayed ethylene contract settlements in Europe. Italian PVC producers, who rely significantly on imported DINP, are pushing for price increases to offset the recent ethylene price hikes. This strategy is part of a broader effort to recover margins, with some suppliers already aligning their prices with a €40/ton increase in the monomer.

A major DINP supplier has initiated price hikes to reflect these increased costs, although market acceptance remains uncertain as negotiations are still in progress. If initial price increase requests face resistance, exporters might shift focus to markets like Türkiye and North Africa, where European rates are more favorable. In the spot market, buyers are expected to delay purchases until pricing policies are finalized, leading to cautious replenishment behavior.

Demand for DINP in April and early May remained stable but saw improvement towards the end of the month, driven by downstream sector activities. However, purchasing slowed as the month closed, reflecting a lack of recovery in derivative sectors such as automotive and construction. Italian PVC producers are advocating for price increases, but the market might only accept a modest rise of around €20/ton. Meanwhile, competitive pricing from U.S. PVC imports, particularly plasticized varieties, is exerting downward pressure on German DINP exports.

Looking ahead, the forecast for DINP pricing in Italy suggests a fluctuating trend: a decrease in May, followed by an increase in June, and another decrease in July. These changes are influenced by inventory levels, import supplies, and domestic demand pressures. May's expected slowdown in demand is due to inventory surpluses and competitive import pricing. Conversely, June might see demand strengthen with increased production and new orders. By July, stable prices of DINP are anticipated as feedstock supplies secure and energy costs decrease, balancing the market dynamics.