Skip to main content
Sister Publication Links
  • Sustainable Plastics
  • Rubber News
Subscribe
  • Login
  • Register
  • Subscribe
  • News
    • Processor News
    • Suppliers
    • More News
    • Digital Edition
    • End Markets
    • Special Reports
    • Newsletters
    • Resin pricing news
    • Videos
    • Injection Molding
    • Blow Molding
    • Film & Sheet
    • Pipe/Profile/Tubing
    • Rotomolding
    • Thermoforming
    • Recycling
    • Machinery
    • Materials
    • Molds/Tooling
    • Product news
    • Design
    • Mergers & Acquisitions
    • Sustainability
    • Public Policy
    • Material Insights Videos
    • Numbers that Matter
    • Automotive
    • Packaging
    • Medical
    • Consumer Products
    • Construction
    • CEO Issue
    • Diversity
    • Best Places to Work
      • 2022 winners
    • Processor of the Year
    • Rising Stars
    • Women Breaking the Mold
  • Opinion
    • The Plastics Blog
    • Kickstart
    • One Good Resin
    • BRICS and Plastics
    • All Things Data
    • Viewpoint
    • From Pillar to Post
    • Perspective
    • Mailbag
    • Fake Plastic Trees
  • Shop Floor
    • Blending
    • Compounding
    • Drying
    • Injection Molding
    • Purging
    • Robotics
    • Size Reduction
    • Structural Foam
    • Tooling
    • Training
  • Events
    • K Show Livestream
    • Plastics News Events
    • Industry Events
    • Injection Molding & Design Expo
    • Livestreams/Webinars
    • Editorial Livestreams
    • Ask the Expert
    • Plastics News Events Library
    • Processor of the Year submissions
    • Plastics News Executive Forum
    • Injection Molding & Design Expo
    • Plastics News Caps & Closures
    • Women Breaking the Mold Networking Forum
    • Plastics in Automotive
    • Reuters Responsible Business Europe 2022
    • Reifenhäuser Technologies Livestreams
    • Polymer Points Live
    • Numbers that Matter Live
    • Plastics in Politics Live
    • Sustainable Plastics Live
    • Plastics Caps & Closures Library
    • Plastics in Healthcare Library
    • Women Breaking the Mold Networking Forum Library
  • Resin Prices
    • All Resins
    • Commodity TPs
    • High Temp TPs
    • ETPs
    • Thermosets
    • Recycled Plastics
    • Historic Commodity Thermoplastics
    • Historic High Temp Thermoplastics
    • Historic Engineering Thermoplastics
    • Historic Thermosets
    • Historic Recycled Plastics
  • Rankings & Data
    • Injection Molders
    • Blow Molders
    • Film Sheet
    • Thermoformers
    • Pipe Profile Tubing
    • Rotomolders
    • Mold/Toolmakers
    • LSR Processors
    • Recyclers
    • Compounders - List
    • Association - List
    • Plastic Lumber - List
    • All
  • Directory
  • Custom
    • Sponsored Content
    • LS Mtron Sponsored Content
    • Conair Sponsored Content
    • KraussMaffei Sponsored Content
    • ENGEL Sponsored Content
    • White Papers
    • Classifieds
    • Place an Ad
    • Sign up for Early Classified
MENU
Breadcrumb
  1. Home
  2. News
May 17, 1999 02:00 AM

POLYPROPYLENE PRICES RIDING COATTAILS OF DEMAND, OUTAGE

Frank Esposito
Senior Staff Reporter
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print

    Aided by surging demand, polypropylene makers have thrown conventional wisdom out the window and increased prices since mid-April.

    PP prices are up an average of 1.5 cents per pound on homopolymer and impact copolymer grades and 2 cents per pound on random copolymer grades, according to several buyers and producers contacted recently.

    The difference in the price hikes are the result of increased demand and higher production costs for random copolymer material, much of which is sold into consumer and industrial markets for products such as toys and storage containers.

    With 1.9 billion pounds of new capacity set to come on line this year, few expected PP prices to rise. But resin statistics compiled by the Society of the Plastics Industry Inc. in Washington show demand was up almost 7 percent in the first two months of 1999. That growth combined with a maintenance shutdown at a major Fina Oil and Chemical Co. plant in La Porte, Texas, has tightened the market and given producers the push they needed to nudge prices higher.

    Major producers had been seeking increases of 1.5-3 cents per pound for dates ranging from March 15-April 1.

    The PP pricing picture remains convoluted amid a barrage of increase attempts that are dividing the industry's largest producers. Proposed price increases for May again range from 1.5-3 cents per pound.

    Market leader Montell Polyolefins Inc. of Wilmington, Del., is seeking a 2 cent increase on homopolymer and impact copolymer grades, and a 4 cent increase on clarified random copolymer grades effective May 10. Dallas-based Fina, which ranks second in North American production, is seeking a 1.5 cent increase for May 1 and an additional 2 cent increase June 1.

    The move that has the most support is a 3 cent jump scheduled for May 15. That attempt is being supported by BP Amoco Corp. of Alpharetta, Ga.; Equistar Chemicals LP of Houston; Phillips Sumika Polypropylene Co. of Houston; Solvay Polymers of Houston and Union Carbide Corp. of Danbury, Conn. Combined, those five firms control about 25 percent of 1999 industry capacity.

    To date, Huntsman Corp. of Salt Lake City is the only producer to join Fina in the June increase attempt. Huntsman is seeking 3 cents June 1.

    A Fina official said his firm split its increase attempt because low profitability and high utilization rates did not justify larger increases when it made its announcement in February. He added the June increase is needed because additional capacity won't actually hit the market until the second half of the year.

    One industry executive said PP demand in the first quarter of 1999 was up 9 percent, exceeding industry expectations of 7 percent growth.

    ``There's been a generally strong economy and demand from the carpet and automotive sectors has been especially strong,'' the executive said. ``Operating rates are in the high 90s. The pressure [on the market] is very real.''

    But the executive added that uncertainty on the part of some PP makers has prevented the industry from raising prices at the same rate propylene prices have climbed.

    ``There are different views on what the market should be doing,'' he said. ``Some [PP] producers may have underestimated moves by the propylene producers. The polypropylene increases have been taking a couple of months to go through, but the propylene increases have gone through right now. Boom!''

    Industry consultant Staci Pursley, a market analyst with TownsendTarnell in Houston, said PP makers are getting what they can while they can.

    ``This is a really good time to get the increase,'' Pursley said. ``Things won't be as favorable later in the year because of capacity expansions.''

    Epsilon Products Co. of Marcus Hook, Pa., is scheduled to add 800 million pounds of capacity in Garyville, La., this summer, while Aristech Chemical Corp. of Pittsburgh plans to add 550 million pounds of material in La Porte this fall.

    In addition, BP Amoco started operations at a 550 million pound expansion in Alvin, Texas, in March. Company officials said the project is operating at 80 percent of capacity.

    Buyers were somewhat surprised the increases have held, and remained skeptical about further upswings.

    ``It looks like [the increases] are going through, but it might just be because [PP makers] were totally wiped out last year,'' A Pennsylvania-based buyer said.

    ``Producers have tried to confuse the market with a blur of announcements,'' a Massachusetts-based buyer added. ``If [the increases] hold until September, that's gonna be it.''

    RECOMMENDED FOR YOU
    New owners plan growth across US for medical molder Seaway
    Letter
    to the
    Editor

    Do you have an opinion about this story? Do you have some thoughts you'd like to share with our readers? Plastics News would love to hear from you. Email your letter to Editor at [email protected]

    Most Popular
    1
    Rhode Island kills chemical recycling bill, ACC cites 'misinformation'
    2
    Invista upgrading nylon 6/6 production in South Carolina
    3
    Canada moves to ban single-use plastics, limit chasing arrows symbol
    4
    Rotomolder Centro invests $6M in new Iowa facility
    5
    Peek behind the data shows how top injection molders grew in 2021
    SIGN UP FOR TO RECEIVE THESE EMAILS AND ENEWSLETTERS
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    Get our newsletters

    Staying current is easy with Plastics News delivered straight to your inbox, free of charge.

    Subscribe today

    Subscribe to Plastics News

    Subscribe now
    Connect with Us
    • LinkedIn
    • Facebook
    • Twitter
    • Instagram

    Plastics News covers the business of the global plastics industry. We report news, gather data and deliver timely information that provides our readers with a competitive advantage.

    Contact Us

    1155 Gratiot Avenue
    Detroit MI 48207-2997

    Customer Service:
    877-320-1723

    Resources
    • About
    • Staff
    • Editorial Calendar
    • Media Kit
    • Data Store
    • Digital Edition
    • Custom Content
    • People
    • Contact
    • Careers
    • Sitemap
    Related Crain Publications
    • Sustainable Plastics
    • Rubber News
    • Urethanes Technology
    • European Rubber Journal
    • Tire Business
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Copyright © 1996-2022. Crain Communications, Inc. All Rights Reserved.
    • News
      • Processor News
        • Injection Molding
        • Blow Molding
        • Film & Sheet
        • Pipe/Profile/Tubing
        • Rotomolding
        • Thermoforming
        • Recycling
      • Suppliers
        • Machinery
        • Materials
        • Molds/Tooling
        • Product news
        • Design
      • More News
        • Mergers & Acquisitions
        • Sustainability
        • Public Policy
        • Material Insights Videos
        • Numbers that Matter
      • Digital Edition
      • End Markets
        • Automotive
        • Packaging
        • Medical
        • Consumer Products
        • Construction
      • Special Reports
        • CEO Issue
        • Diversity
        • Best Places to Work
          • 2022 winners
        • Processor of the Year
        • Rising Stars
        • Women Breaking the Mold
      • Newsletters
      • Resin pricing news
      • Videos
    • Opinion
      • The Plastics Blog
      • Kickstart
      • One Good Resin
      • BRICS and Plastics
      • All Things Data
      • Viewpoint
      • From Pillar to Post
      • Perspective
      • Mailbag
      • Fake Plastic Trees
    • Shop Floor
      • Blending
      • Compounding
      • Drying
      • Injection Molding
      • Purging
      • Robotics
      • Size Reduction
      • Structural Foam
      • Tooling
      • Training
    • Events
      • K Show Livestream
      • Plastics News Events
        • Plastics News Executive Forum
        • Injection Molding & Design Expo
        • Plastics News Caps & Closures
        • Women Breaking the Mold Networking Forum
        • Plastics in Automotive
      • Industry Events
      • Injection Molding & Design Expo
      • Livestreams/Webinars
        • Reuters Responsible Business Europe 2022
        • Reifenhäuser Technologies Livestreams
      • Editorial Livestreams
        • Polymer Points Live
        • Numbers that Matter Live
        • Plastics in Politics Live
        • Sustainable Plastics Live
      • Ask the Expert
      • Plastics News Events Library
        • Plastics Caps & Closures Library
        • Plastics in Healthcare Library
        • Women Breaking the Mold Networking Forum Library
      • Processor of the Year submissions
    • Resin Prices
      • All Resins
      • Commodity TPs
        • Historic Commodity Thermoplastics
      • High Temp TPs
        • Historic High Temp Thermoplastics
      • ETPs
        • Historic Engineering Thermoplastics
      • Thermosets
        • Historic Thermosets
      • Recycled Plastics
        • Historic Recycled Plastics
    • Rankings & Data
      • Injection Molders
      • Blow Molders
      • Film Sheet
      • Thermoformers
      • Pipe Profile Tubing
      • Rotomolders
      • Mold/Toolmakers
      • LSR Processors
      • Recyclers
      • Compounders - List
      • Association - List
      • Plastic Lumber - List
      • All
    • Directory
    • Custom
      • Sponsored Content
      • LS Mtron Sponsored Content
      • Conair Sponsored Content
      • KraussMaffei Sponsored Content
      • ENGEL Sponsored Content
      • White Papers
      • Classifieds
        • Place an Ad
        • Sign up for Early Classified