Polypropylene prices drop 10 cents in April

By Frank Esposito
Senior Staff Reporter

Published: May 2, 2013 2:53 pm ET
Updated: May 2, 2013 2:56 pm ET

Related to this story

Topics Materials, Resin Pricing, Materials Suppliers
Companies & Associations American Chemistry Council

AKRON, OHIO — North American polypropylene resin process tumbled yet again in April, sliding down an average of 10 cents per pound.

The 10-cent slide comes after prices fell an average of 6 cents per pound in March. Prior to that, regional prices had jumped 21 cents total in January and February. So prices remain up by a net of 5 cents per pound so far in 2013.

The April drop “was driven by refineries coming back up, along with some help from [propane dehydrogenation] units running strong,” a PP buyer in the Midwest U.S. said. The buyer added that he expects prices to fall again in May, but not to the extent of the April move.

Market analyst Phil Karig said that continued volatility is not a good thing for the PP sector.

“As much as resin buyers might appreciate the most recent downturn in prices, many know deep down that the continued volatility of PP prices is potentially or already corrosive to their relationships with their own customers,” Karig wrote in an e-mail. “No one wants to continually be talking about large price changes with a customer on what sometimes seems like a monthly basis.”

“That is corrosive because contentious price discussions can crowd out cooperative efforts in areas such as new product development,” added Karig, managing director of the Mathelin Bay Associates LLC consulting firm in St. Louis.

The April drop marks the 11th time that North American PP prices have experienced a double-digit increase or decrease in monthly pricing since May 2010, according to the Plastics News resin pricing chart. PP has become more volatile price-wise than the other major resins it competes with, as well as more volatile than crude oil, according to Karig.

“When a resin is more volatile than its peers and general market indices such as crude oil prices that is very much the equivalent of a risky stock more suitable for day trading than long-term investing,” he said.

Through March, U.S./Canadian PP demand had tumbled almost 10 percent, according to the American Chemistry Council in Washington. A domestic sales drop of 8 percent was worsened by a 48 percent plunge in export sales.

One regional PP end market that held up fairly well in that dreary three-month period was injection molded rigid packaging, where sales essentially were flat at about 576 million pounds. Those applications — including cups and containers, caps and closures and crates and totes — accounted for almost 16 percent of domestic PP demand in the first three months of the year.


Comments

Polypropylene prices drop 10 cents in April

By Frank Esposito
Senior Staff Reporter

Published: May 2, 2013 2:53 pm ET
Updated: May 2, 2013 2:56 pm ET

Post Your Comments


Back to story


More stories

Image

PP prices rise 5 cents

August 28, 2014 3:59 pm ET

After a one-month break, volatility has returned to the North American polypropylene resin market, with prices increasing by an average of 5 cents...    More

Image

DuPont fined for 2010 chemicals release

August 28, 2014 1:37 pm ET

DuPont Co. has been fined almost $1.3 million for the release of several chemicals — including plastics feedstock phosgene — at its plant ...    More

Image

Truce? ACC, US Green Building Council agree to work together on LEED

August 28, 2014 12:08 pm ET

The American Chemistry Council (ACC) and the U.S. Green Building Council (USGBC) announced Aug. 27 that they will be working together on a new...    More

Image

LyondellBasell to build feedstock plant on Gulf Coast

August 28, 2014 11:05 am ET

LyondellBasell Industries will build a world scale propylene oxide plant on the U.S. Gulf Coast with a capacity of 900,000 metric tons per year.    More

Image

Bayer seeing success in project to replace petroleum with C02

August 28, 2014 10:18 am ET

Bayer MaterialScience says its research into the potential of using carbon dioxide as a raw material already is paying off in studies showing that C02...    More

Market Reports

Thermoformed Packaging 2014 Market Review & Outlook North America

This in-depth report analyzes economic and market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as growth strategies being implemented by thermoformed packaging companies.

Learn more

Pipe, Profile & Tubing Extrusion in North America 2014

U.S. demand for extruded plastics is expected to grow by 3 percent in 2014, with PVC remaining the largest segment.

Plastic pipe will post the strongest gains through 2018, continuing to take market share from competing materials in a range of markets.

Our latest market report provides in-depth analysis of current trends and their financial impact on the pipe, profile and tubing extrusion industry in North America.

Learn more

2014 Injection Molding Industry Report

GROWTH, OPPORTUNITY IN SIGHT FOR INJECTION MOLDERS IN 2014

In the wake of the economic turbulence earlier in this decade, molders today find themselves in much better shape. Molders are gaining a competitive advantage by investing in people, equipment and seeking inroads into new markets on a global scale.

Growth in the injection molding industry is going to be driven by low financing costs and a continued move to reshore some business.

Learn more

Upcoming Plastics News Events

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

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

More Events