Overall spot resin prices were steady during the short Thanksgiving week. Sharp discounts continued to fly for off-grade railcars, while resellers maintained their efforts to trim uncommitted warehoused resins, reports the PlasticsExchange (Chicago) in its Market Update. Buying was generally good: Some procured material for December usage, while others required rush deliveries to stay in production over the long Thanksgiving weekend.
|Image courtesy Cool Design/|
November brought price relief to processors, as polyethylene (PE) contracts decreased $0.03/lb, while most polypropylene (PP) contracts followed PGP $0.025/lb lower. Exports remained robust, and Houston-area warehouses tried to keep up with the packaging flow.
The spot PE market was surprisingly active during the three-day trading week. Though the PlasticsExchange trading desk only completed an average volume of transactions, market activity was viewed positively considering that many participants left for an early holiday break. Buyers hunting for deals were presented with good fair market pricing and were not shy to transact. Some resins that had been tough to source, such as low-density PE film, were quickly snatched up when they surfaced. Spot PE prices held firm, as supply was thin and buyers out to procure last-minute material were in a weak position to negotiate.
The contract market appears to be settling down $0.03/lb for November, unwinding the September increase. The export market continued to be very active, as international buyers flocked to North America for a cheap source of material. Heading into December, the PlasticsExchange expects more inventory shedding and some end-of-year steals as suppliers position their year-end inventories. Typically the month starts out busy and then grinds to a halt by the final full week. PlasticsExchange analysts recommend planning accordingly.
The spot PP market was busier than expected as November came to an end. Material availability for most grades was generally adequate and there were some sharp one-off deals offered. Buyers were ready with orders in hand. Consequently, completed volumes were hefty while overall prices for both homo- and co-polymer PP ended flat for the week. For the first time in about a month, homo-polymer PP buying outstripped co-polymer PP order flow, and truckload volumes outweighed railcar transactions. Direct processor demand also outshined reseller/distributor buying. Current spot monomer levels point to mild softness for December PP contracts, but things can change, as the month is just beginning.
Read the full Market Update on the PlasticsExchange website.