Resin Prices Bottom Out

The free fall in resin prices appeared to end with a thump last month. Makers of PE, PP, and PVC resins were posting price increases, at least part of which are likely to go through. Only PS prices have yet to find a bottom.

 

PE PRICES REBOUNDING?

Polyethylene prices apparently bottomed out by the end of December after dropping another 10¢/lb, bringing the total decline in 2008 to 43¢/lb. At least part of suppliers’ 7¢ price hike for Jan. 1 appears to have a good chance of taking effect this month. Meanwhile, resin producers have also called for an additional 5¢ hike for Feb.1. The uptick was supported by the direction of the London Metal Exchange (LME) short-term futures contract in blown-film butene LLDPE for February. It rose to 39¢/lb from an all-time low of 19.7¢ in January, but was still far below December’s 58.7¢.

Contributing factors: Reduced ethylene monomer production is putting upward pressure on PE resin prices. Monomer spot prices rose from December’s low of 16¢/lb to 23¢ by mid-January. Although December’s ethylene contract price dropped to 28¢/lb—a whopping 35¢ reduction from the September level—the rise in spot prices last month was expected to result in higher contract prices for January.

Mike Burns, global business director for PE at resin purchasing consultant Resin Technology, Inc. (RTI) in Fort Worth, Texas, sees pressure to increase PE prices from shrinking monomer and polymer profit margins. He thinks this year’s first hike is apt to split into 4¢ this month and 3¢ in March.

 

PP PRICES RISING, TOO?

Another 10¢/lb fall in December meant that polypropylene prices dropped a total of 68¢ to 70¢ last year. About half of PP suppliers’ 6¢ January hike appeared to have a chance of getting through by this month. Mirroring this trend was the rise in LME’s February North American short-term futures contract in g-p injection-grade homopolymer to 39.2¢/lb from January’s 29.8¢. “Expect at least 2¢ to 3¢ of this new price increase to go through initially, and possibly 4¢ to 6¢ total over the next two months,” says Scott Newell, RTI’s director of client services for PP.

Contributing Factors: Although not settled at press time, January contract prices for propylene monomer, which had dropped to around 20¢/lb in December, were projected to settle 2¢ to 3¢ higher for January.

Says Newell, “Sensing that the bottom was near, some processors ended up with good resin price deals in November and December. Even now, in mid-January, there are still some attractively low numbers, in the 30¢ range, particularly in the spot market. However, demand is poor. Even exports are off significantly from what we saw in the last couple of years.”

PP capacity utilization is said to be well under 70%. This is evidenced by plant shutdowns totaling close to 800 million lb/yr from Ineos Olefins and Polymers (520 million lb), Flint Hills Resources (120 million lb), and ChevronPhillips (140 million lb). The latest announcement came from Sunoco, which intends to shut its 400-million-lb plant in Bayport, Texas, by Apr. 30.

 

PVC PRICES STAGNATE

After sliding roughly 20¢/lb in the fourth quarter, PVC prices in January appeared to be flat. Resin producers all supported a 5¢ increase for Feb. 1. Formosa’s initial 5¢ hike from Jan. 1 was pushed ahead one month, while Shintech’s initial hike of 7¢ for Feb. 1 was trimmed to 5¢ with 2¢ more due March 1.

Contributing factors: PVC demand continues to be very weak. Domestic pipe, window, and siding processors say resin prices may edge up in February, but only by 2¢, not 5¢, and then only if ethylene monomer goes up, too. Ethylene represents 43% of the cost of PVC. Spot ethylene in mid January was 25¢/lb. Contracts were expected to settle at around the same level.

 

PS STILL DROPPING

After plunging 12¢/lb in December, polystyrene resin prices were expected to fall 8¢ for crystal and 9¢ for HIPS in January.

Contributing factors: There is a slight increase in demand in packaging sectors, but construction and durable goods are still very weak.

Benzene contracts settled at $1.01/gal last month, though they should have been around $2, given other feedstock costs. Spot benzene was a little higher at $1.11. 

 

 

Market Prices Effective Mid-Jan A
RESIN GRADEb	¢/LB	¢/CU INc

ABS         MED IMPACT    90 - 110      340 - 412     HI IMPACT    95 - 130      359 - 491     X-HI IMPACT    110 - 150      415 - 567     HI HEAT    90 - 125      340 - 472     PIPE    85 - 95      321 - 359     SHEET    90 - 105      340 - 397     TRANSPARENT    134 - 205      506 - 774     FITTINGS    94 - 115      355 - 434     PLATING    165      623     FLAME RET    120 - 140      453 - 529     STRUCT FM    92 - 102      347 - 385     10% GLASS    134 - 145      506 - 548     30% GLASS    129 - 141      487     ABS/PC ALLOY    154 - 185      532 - 699     ABS/PVC ALLOY    139 - 144      525 - 544     ABS/NYLON ALLOY    199 - 355      752 - 1341     ACETAL           HOMOPOL    151 - 172      7.7 - 8.7       20% GLASS    171 - 235      8.7 - 11.9     COPOLYMER    144 - 160      7.3 - 8.1     25% GLASS    171 - 245      8.7 - 12.4     ACRYLIC           G-P    117      5.0       IMPACT    192      8.2       ACRYLONITRILE COPOL           EXTRUSION    101 - 116      4.0 - 4.6       INJECTION    120 - 135      4.8 - 5.4       ALKYD  65 - 74    4.9 - 5.5       CELLULOSICS           ACETATE    187      8.6       CAB    189      8.2       CAP    189      8.2       DAP (G-P)  251 - 497    16.7 - 34.7       EPOXY           G-P RESIN    116 - 126      NAd       COMPOUNDS               C/B/Te    123 - 166      9.4 - 12.9       R/C/Df    208 - 271      15.3 - 20.1       SEMICONDUCTOR               NOVOLAC    193 - 228      13.1 - 15.9       ANHYDRIDE    188 - 268      13.9 - 19.2       EVA           INJECTION    69 - 71      2.3 - 2.4       FILM EXTRU    67 - 69      2.3       EVOH  330    15       FLUORO-POLYMER           CTFE    5000 - 6000      385 - 462       ECTFE    1200 - 1680      90.7 - 120       ETFE    1205 - 1730      80.7 - 115.8       FEP    971 - 1470      74.8 - 113.2       PFA    1550 - 2520      120 - 195       PTFE    500 - 950      33.5 - 63.6       PVDF    750 - 1200      48 - 76       IONOMER           PACKAGING    127 - 166      4.3 - 6.0       INDUSTRIAL    150 - 244      5.0 - 8.3       LIQUID-CRYSTAL POLYMERS           INJECTION MIN FILLED    690 - 1035      44.2 - 72.1       GLASS FILLED    695 - 895      40 - 52       CARBON FILLED    1700 - 2000      83.2 - 138.6       UNFILLED    1000 - 1200      58 - 70       EXTRUSION UNFILLED    1200 - 2200      60.5 - 110.9       MELAMINE COMPOUND  90 - 94    5.5 - 5.6       MELAMINE/PHENOLIC COMPOUND  75 - 83    4.5 - 5.0       NYLON           TYPE 6    139 - 159      5.7 - 6.5       MIN FILLED    131 - 144      5.4 - 5.9       30% GLASS    148 - 173      6.0 - 7.0       TYPE 66    153 - 168      6.3 - 6.9       MIN FILLED    151 - 159      6.2 - 6.5       30% GLASS    142 - 192      5.8 - 7.9       TYPE 69    250 - 276      9.7 - 10.7       TYPE 6/10    286 - 313      12.4 - 13.6       TYPE 612    400      15.3       30% GLASS    309 - 311      14.7       40% GLASS    309      14.7       TYPE 46    295      12.6       TYPE 11    650 - 750      24.3 - 28       30% GLASS    NAd - NAd      NAd - NAd       40% GLASS    NAd - NAd      NAd - NAd       TYPE 12    318 - 341      12.1 - 13.0       30% GLASS    327 - 350      14.7 - 15.8       50% GLASS    299 - 340      15.6 - 17.8       TRANSPARENT AMORPHOUS    247 - 360      10.3 - 15.0       PHENOLIC MOLD COMP  75    3.8       REINFORCED GRADES    105 - 268      6.1 - 16       POLYAMIDE-IMIDEg           UNFILLED    2750      148.5       30% GLASS    2500      135       30% CARBON FIB.    3500      185       POLYARYLATE  200 - 280    8.8 - 12.3       POLYARYL SULFONE  440    21.8       POLYBUTYLENE           G-P    94 - 96      3.1       FILM    88 - 91      2.9       PIPE               COLD WATER    116 - 120      3.9 - 4.0       HOT WATER    162 - 166      5.5 - 5.6       POLYCARBONATE           INJECTION    166 - 182     7.9       20% GLASS    172 - 190     8.2       30% GLASS    173 - 217     9.3       EXTRUSION    140 - 180     7.7       BLOW MOLD    145 - 185     7.5       STRUCT FOAM    144 - 181     7.8       20% GLASS    230 - 255     11.0       FR    161 - 197     8.5       CD    130 - 195     8.4       POLYESTER (TP) PBT TYPE           UNFILLED    145 - 150      6.8 - 7.3       HI-IMP    165 - 175      7.8 - 8.3       30% GLASS, FR    195 - 215      9.2 - 10.1       STRUCT FOAM    159 - 165      NAd       PET           BOTTLE (RAILCAR)    67 - 71      3.4 - 3.6       MOD PET               30% GLASS    132 - 143      7.4       55% GLASS    148 - 155      9.8       30% GLASS FLAME RET    147 - 157      9.2       PETG COPOL    114 - 124      5.2 - 5.6       POLYESTER THERMOSET           G-P ORTHO    151 - 162     NAd       ISOPHTHALIC    175 - 196     NAd       BIS-A    210 - 235     NAd       PEEK  4400    231       30% GLASS    3300      173       POLYETHERIMIDE  641 - 646    29.3 - 29.5       30% GLASS    526 - 531      24.0 - 24.2       POLYETHERKETONE (PEK)  2950    130.1       30% GLASS    2600      153       POLYETHERSULFONE  350 - 400    17.2 - 19.7       30% GLASS    425 - 525      21 - 25.9       POLYETHYLENE (RAILCAR) LDPE           G-P MOLDING & EXTRU    43 - 45     1.4 - 1.5      INJECTION    45 - 47     1.5 - 1.6      LID RESIN    47 - 49     1.6      LINER    45 - 47     1.5 - 1.6      CLARITY    41 - 43     1.4      EXTRU COATG    46 - 48     1.5 - 1.6      BLOW MOLD    48 - 50     1.6 - 1.7      LLDPE, BUTENE BASED           G-P MOLDING    50 - 52      1.7       LME 30-DAYj    19.7     0.6       FILM    55 - 57      1.8 - 1.9       ROTOMOLD    52 - 54      1.7 - 1.8       LLDPE, HAO-BASED           G-P MOLDING    53 - 55      1.8       LID RESIN    63 - 65      2.0 - 2.1       LINER FILM    56 - 58      1.8 - 1.9       HDPE           G-P INJ MOLD    53 - 55      1.8 - 1.9       FILM    60 - 62      2.1       BLOW MOLD    61 - 63      2.1 - 2.2       HMW-HDPE           BLOW MOLDING    57 - 59      1.9 - 2.0       FILM    58 - 60      2.0       PIPE    65 - 67      2.2 - 2.3       UHMW-PE  1.22 - 1.52    4.1 - 5.1       PPE/PPO BASED RESIN           INJECTION    180      6.8       20% GLASSh    283      12.3       30% GLASSh    291      13.3       EXTRUSIONh    242      9.2       STRUCT FM    231      NAd       PPS           40% GLASS    450 - 520      27.0 - 31.2       55% GLASS/MINERAL    345 - 420      22.7 - 27.7       65% GLASS/MINERAL    270 - 315      18.9 - 22.1       POLYPROPYLENE (RAILCAR)           G-P HOMOPOL INJECTION    38 - 40     1.3      LME 30-DAYj    39.2      1.3       EXTRUSION FIBER    36 - 38     1.2 - 1.3      PROFILES    44 - 46     1.4 - 1.5      RANDOM COPOL               BLOW MOLDING    42 - 44     1.4      FILM    42 - 44     1.4      INJECTION    41 - 43     1.3 - 1.4      IMPACT COPOL               MED IMP    52 - 54     1.7      HI IMP    54 - 56     1.7 - 1.8      POLYSTYRENE (RAILCAR)           G-P CRYSTAL    53 - 59     2.0 - 2.2      HI HEAT    56 - 61     2.1 - 2.3      HIPS    62 - 68     2.3 - 2.6      SUPER HI IMP    69 - 79     2.4 - 3.0      FR    75 - 80     2.8 - 3.0      STRUCT FM (FR)    63 - 65     2.4      EPS           UNMODIFIED    85 - 88      NAd       MODIFIED    86 - 90      NAd       POLYSULFONE  650 - 750    29 - 33       10% GLASS 430 20.6    799 - 875      36 - 39       30% GLASS 372 20.01    699 - 775      31 - 35       POLYURETHANE (TP)           ESTER TYPE    185 - 255      8 - 11       ETHER TYPE    245 - 295      10.6 - 13       PU ISOCYANATES           POLYMERIC MDI    125 - 145      NAd       80/20 TDI    135 - 145      NAd       PVC RESIN (RAILCAR)           G-P HOMOPOL    42 - 44      NAd       PIPE    41      NAd       FILM    47 - 49      NAd       COPOLYMER FLOORING    69 - 74      NAd       DISPERSION HOMOPOLY    81 - 87      NAd       COPOLYMER    86 - 90      NAd       CPVC PIPE COMPOUND    119      NAd       PVDC           EXTRUDABLE    162      NAd       SILICONES           MOLD. COMP.    581 - 640      38.1 - 39.3       SPECIALTY GR.    891 - 3148      NAd       SILICONE/EPOXY    339 - 343      22.5 - 22.8       STYRENEACRYLIC  108 - 112    3.7 - 4.0       SAN (G-P)  80 - 88    3.0 - 3.3       STYRENE MALEIC ANHYDRIDE           G-P    110 - 115      4.2 - 4.3       HI IMP    130 - 140      4.2 - 4.5       FR    175 - 183      6.7 - 7.0       TP ELASTOMERS           OLEFINIC    70 - 76      2.4       POLYAMIDE    300 - 350      10.9 - 12.7       POLYESTER    200 - 310      8.8 - 13.6       STYRENIC    82 - 237      2.9 - 8.3       UREA MOLDING COMPOUND           BLACK & BROWN               WHITE & IVORY               VINYL ESTER           COR RES    221 - 245     NAd       HEAT & COR RES    246 - 258     NAd

KEY: Colored areas indicate pricing activity. An arrow () indicates direction of price change. aTruckload, unless otherwise specified. bUnfilled, natural color, unless otherwise specified. cBased on typical or average density. dNot applicable. eNovolac and anhydride grades for coils, bushings, transformers. fNovolac and anhydride grades for resisitors, capacitors, diodes. gIn quantities of 20,000 lb. h19,800-lb load. jLME 30-day futures contract for lots of 54,564 lb..