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Weekly resin report: Spot trading prices remain flat

Article-Weekly resin report: Spot trading prices remain flat

Weekly resin report: Spot trading prices remain flat
A steady flow of offers was met with eager buyers, and completed volumes were again well above the 2018/2019 average. Since both buyers and sellers were very willing participants, spot prices stayed flat across the board. 

Spot resin trading had another vibrant week, as material flowed freely through willing market participants, reports the PlasticsExchange (Chicago) in its Market Update. Both prime and off-grade material changed hands with minimal negotiating, leaving spot prices for both polyethylene (PE) and polypropylene (PP) flat across the board, matching last week’s levels.

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Solid spot domestic demand has persisted despite increasing chatter of a global slowdown and geopolitical positioning. Supply has been more than up to the task, as the PlasticsExchange spot market has swelled to nearly 20 million pounds on current offer. In hopes to regain recent PE contract market concessions, a $0.03/lb and $0.04/lb increase for August and September have been looming over the market, but implementation is unlikely in the absence of an unforeseen event, such as a disruptive hurricane or a spontaneous solution to the trade war, writes the PlasticsExchange. Little change is foreseen in August PP contracts, as monomer has been steady to only slightly higher and resin availability has been ample, though thinning. 

The spot PE market ramped up last week. A steady flow of offers was met with eager buyers and completed volumes were again well above the PlasticsExchange’s 2018/2019 average. Since both buyers and sellers were very willing participants, spot prices stayed flat across the board. Transactions ran the full gamut among commodity grades, with heavy dealings in both prime and off grade, in railcar and truckload volumes.

As anticipated, the contract market appears to be rolling flat this month. Packaging warehouses in Houston continue to be slammed with orders, as heavy global resin trade continues despite economic and geopolitical uncertainty. Trade wars continue to escalate to the point that new partnerships and channels are being explored on a macro scale. Although the hurricane season has been benign, we are now entering the peak season. The PlasticsExchange recommends keeping that in mind while making inventory and buying decisions. 

PP trading remained busy, as it has been for two months solid. Offers flowed; striking a deal on workable prices, however, proved difficult. Prices were steady, as there were no major supply disruptions and PGP settled the week about a half-cent higher. Completed deals favored widespec over prime, and the majority of business at the PlasticsExchange favored co-polymer over homo-polymer PP. Traders were busy swapping material, procuring fresh railcars and truckloads for immediate release. There have been plenty of good deals out there, but supply became a tad tougher as the week wore on, according to the PlasticsExchange. Based on current market conditions, it appears August PP contracts will roll flat.

Read the full Market Update on the PlasticsExchange website.

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