The spot resin markets ended the year quietly and average prices for both polyethylene (PE) and polypropylene (PP) were flat, notes the PlasticsExchange (Chicago) in its Market Update. Most December resin business was booked by the middle of the month; while there were relatively few offers during the second half, the PlasticsExchange spotted some very well-priced deals. Domestic demand was equally subdued, as a number of processors shut down during the holidays.
|Image courtesy Cool Design/|
The PE market was quiet this week, but it was one heck of a year. In general, the market rallied in the first quarter and bottomed out near the end of the second quarter. It staged a modest recovery during the summer for what should have been its last hurrah before several new PE plants came online with added production. Hurricane Harvey then rocked the market and sent prices soaring. The market peaked in mid-September and has been sliding ever since. Most PE resins still remain several cents higher for the year, but grades did not necessarily move together or to the same magnitude.
Similarly, there was very little PP activity the last week of the year. Offers, in general, have been scarce and the market has maintained an upward bias. Prices continue to be pushed higher based on rising costs, and producers have leveraged tight supply/demand dynamics to earn a $0.03 to 0.05/lb margin expansion this year. PP began 2017 on a low and rallied from there, peaking in mid-September, but it remains near its high and the PlasticsExchange anticipates continued upward pressure into the new year.
Read the full Market Update on the PlasticsExchange website.