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Weekly resin report: It’s a buyers' market

TAGS: Materials
Weekly resin report: It’s a buyers' market
Processors seem content to watch prices slide and feel no urgency to procure more material than they can consume in the near term. 

The commodity resin markets were fairly active during the first part of last week, but business quickly came to a halt just ahead of the Thanksgiving holiday, writes the PlasticsExchange (Chicago) in its Market Update. Spot resin prices had already dropped significantly the past couple of months, and generic prime was generally steady this past week. Off-grade levels continued to decline, however. Both polyethylene (PE) and polypropylene (PP) will see a contract decrease for November. Houston warehouses are jammed full with a line of railcars awaiting packaging, but are there export orders against all that material? 

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The PE market saw good activity and then fell silent, as Thanksgiving approached. Supplies remained more than adequate and pricing continued to carry a negative bias, according to the PlasticsExchange. Buying activity was split between last-minute truckload shipments ahead of the holiday and others taking advantage of deeply discounted material. 

Generic prime PE pricing was steady to lower. Most HDPE grades have already fallen sharply, but others like LDPE film and LLDPE injection, which had carried steep premiums, are now seeing more price erosion as supplies improve. November PE contracts seem to be gravitating toward a $0.03/lb decrease, as originally offered by several producers early in the month. Processors, noting significant weakness in the spot market, were looking for a sharper decline. Perhaps there will be additional relief in December. 

PP trading slowed from the previous week and volumes were only about average. Material availability was high, with all commodity grades represented. PP contracts seem to be settling down $0.06/lb on average, with some variance likely. In some cases, off-grade railcars have pierced below the $0.40/lb level and generic prime has fallen to levels not consistently seen in about seven years, writes the PlasticsExchange. 

Processors seem content to watch prices slide and feel no urgency to procure more material than they can consume in the near term. While some are picking away with small quantities as needed, others claim to be well stocked through the end of the year.

Read the full Market Update on the PlasticsExchange website.

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