North American prices fall for PET and PP, rise for PVC and solid PS

By Frank Esposito
Senior Staff Reporter

Published: January 26, 2012 6:00 am ET

Related to this story

Topics Materials, Suppliers

AKRON, OHIO (Jan. 26, 2:20 p.m. ET) — The normally slow winter months have been turbulent for commodity resin prices in North America.

Although both buyers and producers tend to hibernate at this time of the year, that hasn’t been the case in late 2011 and early 2012, as buyers have reported price movement on PET bottle resin, polypropylene, PVC and solid polystyrene.

Prices for PET and PP both fell in December, with PET sliding an average of 5 cents per pound and PP dipping an average of 2 cents. Lower seasonal sales volume contributed to lower prices for both of those materials, buyers said.

The 5-cent drop on PET means that regional prices finished 2011 with a net gain of 5 cents, or about 6 percent. Some buyers are expecting pricing for the material to become less volatile with recent consolidation resulting in fewer major producers in the region.

For PP, the 2-cent drop ended an extremely volatile year in which prices shot up an average of 37 cents in the first half of the year before falling 41 cents by year’s end. The 4-cent net loss left prices down about 4 percent for the year.

Pricing volatility and an increase in imported finished goods made from PP was reflected in North American sales totals for the material. Through October, domestic demand was down almost 5 percent vs. the year-ago period, according to the American Chemistry Council in Washington. A drop of almost 22 percent in export sales left overall PP sales in the region down 6 percent for that 10-month period.

The increases seen in markets for PVC and solid PS both have occurred since Jan. 1. PVC prices had climbed about 8 percent during 2011, while solid PS prices finished the year up almost 11 percent.

PVC prices were up an average of 3 cents per pound in January, with producers citing higher spot prices for ethylene feedstock and buyers seeing demand rise slightly from low levels. Ethylene availability also could be affected by a scheduled maintenance turnaround taken by Dow Chemical Co. at its plant in St. Charles, La., according to the PetroChem Wire consulting firm in West Orange, N.J. An ethylene unit at Shell Chemical Co.’s plant in Norco, La., also remained down for maintenance.

A Texas-based PVC buyer said that his firm has seen improved demand for industrial and infrastructure-based PVC products, but he added that demand from the residential housing sector – PVC’s traditional sales base – remains weak.

“We’re seeing some big, isolated purchases on some construction projects, which we weren’t seeing last year at this time,” he said.

Regional PVC sales actually grew almost 3 percent in the first 10 months of 2011, according to ACC, but 18 percent export growth masked a drop of almost 5 percent in domestic demand.

Westlake Chemical Corp.’s attempted takeover of Georgia Gulf Corp. could have a big impact on the North American PVC market. The combined firm would ranks as the region’s second-largest PVC maker and would reduce the number of major players in the market from five to four.

In solid PS, prices for both general-purpose and high-impact material each fell an average of 2 cents per pound in December before GPPS went up 5 cents and HIPS climbed 7 cents in January. The difference in increases was the result of higher prices for butadiene feedstock used in HIPS.

The uptick largely was the result of higher prices for benzene feedstock, since demand remained seasonally weak. Benzene prices shot up almost 25 percent to a level of $3.70 per gallon. That increase was more than was expected by some market watchers, including Wilf Kimball, a market analyst with The Plaza Group in Houston.

“The domestic demand for both cumene and styrene do not support this pricing,” he wrote in a recent benzene report. “Barring any significant crude oil pricing changes, we do not see benzene exceeding the $4 ceiling going forward.”

Regional PS makers now are seeking similar price increases – 5 cents on general-purpose PS and 7 cents on HIPS – for Feb. 1.


Comments

North American prices fall for PET and PP, rise for PVC and solid PS

By Frank Esposito
Senior Staff Reporter

Published: January 26, 2012 6:00 am ET

Post Your Comments


Back to story


More stories

Proposed Shell project draws more than 1,000 to informational meetings

April 17, 2014 2:03 pm ET

More than 1,000 people attended a pair of public meetings hosted by Shell Chemical LP on April 16 to discuss the possibility of building a major...    More

Image

Hedging can slow the resin rollercoaster

April 17, 2014 3:00 pm ET

The good old days — if they even ever existed — are gone, and.Andy VanPutte thinks volatility in the resin market is here to stay and...    More

Spain's Cristian Lay Group buys two materials units of bankrupt LSB

April 17, 2014 11:11 am ET

Spanish industrial conglomerate Cristian Lay Group has purchased two of the bankrupt Spanish PET packaging group La Seda de Barcelona.    More

Negri Bossi's new owners may 'bring significant manufacturing' to US

April 16, 2014 1:09 pm ET

Italian plastics equipment major Negri Bossi may “bring significant manufacturing of injection molding machines back to the United...    More

Image

Polyair rebuilds from Sandy with help from Process Control

April 16, 2014 4:11 pm ET

Hurricane Sandy gutted Polyair Inter Pack Inc.'s Carlstadt, N.J., plant more than a year ago, and Brian Clawson won't soon forget the devastation.    More

Market Reports

Thermoformed Packaging 2014 Market Review & Outlook North America

This in-depth report provides analysis and discussions of economic and political conditions, market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as strategies being implemented by thermoformed packaging companies. In addition, there are reviews of 25 leading thermoformers in the packaging segment, assessing their growth initiatives and performance metrics over 10 years.

Learn more

Automotive Market Review and Outlook 2014 The Americas

This 75-page report features in-depth analysis of the automotive industry for the Americas. It includes discussions of market trends, legislative/regulatory activity impacting production and threats as well as design strategies being implemented by the major automakers. Detailed charts and data tables outline North American automotive production over the last five years.

Learn more

Plastics Building & Construction Market Review and Outlook 2014 with MS Excel chart data

This report provides in-depth analysis of the plastic building and construction market for North America, including discussions of trends, opportunities, threats and the latest developments in construction trends that impact plastics processors.

Learn more

Upcoming Plastics News Events

May 6, 2014 - May 8, 2014Plastics in Medical Devices 2014

May 12, 2014 - May 12, 2014Plastics News Brazil Pharma Summit

September 10, 2014 - September 12, 2014Plastics Caps & Closures 2014

February 3, 2015 - February 7, 2015Plastics News Executive Forum 2015

More Events