It was another ho-hum week for spot resin trading. Demand continued to slacken and supply was sometimes limited by grade during the holiday-shortened week, reports the PlasticsExchange (Chicago) in its Market Update. Resin inquiries were limited, and those that surfaced were mostly for truckloads rather than railcars. Completed volumes fell short of average.
|Image courtesy Cool Design/|
Spot polyethylene (PE) prices were mostly lower last week, while polypropylene (PP) managed steady to a penny higher. Incremental PE exports are still challenged by price, though large quantities seem to be shipping offshore direct by producer, leaving traditional export channels a bit dry and frustrated, according to the PlasticsExchange.
For the second week in a row, PE trading left something to be desired—demand was off and most grades dropped $0.005 to 0.01/lb. A larger number of widespec railcar offers were made available as the week wore on. While the spot markets, both domestic and export, have been seemingly starved of supply, processors have been able to fill most of their prime needs directly, albeit including the February $0.04/lb price increase. While the market prepares for the next $0.03/lb increase nominated for March, processors are still hopeful that resolution of production issues and new capacity will soon begin to weigh on PE prices.
Spot PP activity was good, with completed volumes outstripping those for PE, which only happens occasionally, notes the PlasticsExchange. PP prices have been trending lower as participants eye tumbling feedstock costs, while tight resin fundamentals have been limiting the losses. HoPP prices held firm this past week, while CoPP recouped a penny. PP buyers are grateful for the $0.06/lb contract decrease in February and expect a similar decline in March.
PP imports are starting to hit the shores—material was procured as the market began to rally in early January. In general, resellers have shied away from additional inventory purchases, mostly opting for back-to-back deals. Some sellers even seem to be taking orders at prices that appear too low for current conditions, as they believe their lower sales levels will be fine when it comes time to deliver the resin.
Read the full Market Update on the PlasticsExchange website.