Offers flowed briskly, prices were mixed and completed volumes were average in the spot resin markets last week, according to the PlasticsExchange (Chicago). The industry seemed to shrug off potential supply disruptions from the fire at ExxonMobil’s huge Baytown petrochemical complex. Dozens of workers were hurt, but thankfully none of the injuries were life-threatening.
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| Image courtesy Cool Design/ freedigitalphotos.net. |
Spot polypropylene (PP) prices, which had been sliding back a bit, firmed up just a penny, reports the PlasticsExchange in its Market Update. Generic prime polyethylene (PE) prices kept on an even keel, though deep discounts were available for off grade and easy availability continued into August. PE contract levels have been difficult to gauge, but July should mostly be down $0.03/lb. Exports have been good, though traders have been cautious amid geopolitical concerns and trade wars.
After a very busy July, the spot PE market coasted into month’s end, which came midweek. Although the recent fire at Exxon’s Baytown facility has jolted the monomer markets, it has yet to really affect PE. Completed transaction volumes at the PlasticsExchange were only about average last week, which was a bit of a letdown after such heightened activity. Official PE prices at the resin clearinghouse were all flat, although certain prime products were a little tougher to source for immediate delivery; off grade remained plentiful and did not warrant a price uptick.
Pricing power is currently in the hands of buyers, which is rare. While there are deep discounts and great opportunities available, some of the low-ball bids are simply too aggressive and unrealistic; otherwise, there are deals to be made.
July contract pricing became a little clearer and most PE market participants should see a $0.03/lb mark down. Although the relief is welcomed, many will continue to push for further decreases as spot levels have declined even more. If you’ve been able to supplement your purchasing through the spot market, you have done well this year, remarks the PlasticsExchange.
The spot PP market was active throughout July and the heavy trading continued as the new month began. After rallying early in the month, as spot monomer costs jumped, PP prices fell under pressure as upstream costs started to ease. However, overall pricing for spot homo- and co-polymer PP added a penny this week following the fire at Exxon's Baytown plant. Some of this week’s orders were for business as usual; other customers procured material to bridge their late railcars; while some saw supply risk and added a buffer to their resin inventories. Material availability was still good, although not on par with earlier in the month.
Read the full Market Update on the PlasticsExchange website.
