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While spot resin trading was robust the week of Dec. 14, transactions slipped from the rabid pace seen during the first half of December, reports the PlasticsExchange (Chicago) in its weekly market update. Material availability remains more than ample, and sharp discounts have been available to savvy buyers.

PlasticsToday Staff

December 22, 2015

1 Min Read
Weekly resin update: Discounts abound for year-end shoppers

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Image courtesy Cool Design/freedigitalphotos.net.

Generic prime polyethylene (PE) fell $0.005 to 0.01/lb and off-grade dropped even more. Polypropylene (PP) mostly held steady after coming off a couple cents in the previous week, though well-priced off-grade opportunities abound, note PlasticsExchange analysts.

Spot PE trading remained solid, but completed volumes were less than in previous weeks. The $0.05/lb price increase failed for the third time in December; however, considering sharply lower energy and feedstock costs, processors are seeking actual relief rather than just continued contract price rollovers. Technically, producers will begin the year with the nickel increase again on the table, but contracts may begin to go the other way. In the meantime, the combination of year-end inventory adjustments and weak international PE markets have generated deeply discounted spot buying opportunities.

Although the market slowed somewhat, December is still posting the best PP trading results of the year. Continually improved resin availability, in both bulk railcars and warehoused truckloads, has pressured spot prices, making them quite competitive even for contract buyers. Producers have enjoyed an excellent year of margin expansion; although they lowered PP prices, the magnitude was much less than their cost decrease. The fourth quarter saw an outright resin price increase, and while there is another $0.06/ lb increase nominated for January, the market's momentum seems to have finally stalled out this month.

Read the full Market Update on the PlasticsExchange website.

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