After several months of struggling to increase prices, polystyrene producers in August backed off, leaving prices only slightly changed for this year. Meanwhile, prices for PET packaging resins continue to fall, and polyolefin produ cers continue to see strengths in their markets that they say support price increases they have on the table.
PS producers increased prices by 2 cents per pound in the first quarter of this year, and tried to put a second, 4-cent in crease into effect in May. The first increase helped recoup a 2-cent decrease from January, and the second was the result of slightly higher monomer prices.
However, as a result of resistance and competitive prices in the market, th e 4-cent increase was later rearranged to allow for a 2 cent-per-pound hike in July, followed by another 2-cent increase in August.
Although several buyers said they saw invoices in June and July with the higher prices, they said la st week that those invoices later were adjusted to show prices without the increases.
Plastics News' weekly pricing chart has been adjusted, and now reflects prices at the lower levels.
Producers said last week their markets for PS w ere strong, up about 3 percent from a year ago, but that production capacity utilization rates are between 88 and 90 percent, which indicates some overcapacity.
``We suspect there are some producers who are doing very well, operatin g at 95 percent of their capacity or better, and they are the ones who have been leading the drive for a price increase,'' an executive of one PS-producing company said.
``However, we think there also are producers who have been ope rating at 80 percent of their capacity, and they're the ones who are putting competitive pressures into the market,'' he added.
Meanwhile, PET producers continued to see prices fall as a result of declining prices for paraxylene, a precursor used in the production of terephthalic acid, and increases in production capacities.
PET packaging resins have fallen sharply to about 50 cents per pound, from about 75 cents in January. Paraxylene prices were at a record high of 41 cents per pound in the last quarter of 1995 and first quarter of 1996. Today they have plunged to 22 cents a pound.
Polypropylene producers said last week their 3 cent-per-pound price increase continues to roll through the market. While PP makers said they encountered some resistance from buyers, they added that they continue to use 90-95 percent of their production capacity, and that their orders continue at robust levels.
Polyethylene makers said they also continue to see strength in their markets, and expect a 5 cent-per-pound price increase set for Sept. 1 to take effect.
However, Quantum Chemical Co. of Cincinnati put a slight delay on a portion of the increase by announ cing it would increase its prices for high density PE by 5 cents per pound on Oct. 1. Quantum had announced it would raise its prices for low density and linear low density PE Sept. 1.