At the end of 2018, most resin prices in North America fell to the bottom.
At the end of 2018, most resin prices in the North American commodity market fell to the bottom.
Market sources told Plastics News that in December last year, the average selling price of polypropylene (PP) fell by 8 cents per pound. In addition, all grades of polyethylene (PE) in North America fell by 3 cents per pound, solid polystyrene (PS) prices fell by 7 cents per pound, and polyethylene terephthalate (PET) was used. Resin fell by 4 cents per pound.
According to sources, the price decline is mainly related to the decline in seasonal demand and the increase in the supply of resins and raw materials.
PP fell 10 cents per pound in November last year and fell 18 cents per pound in two months. The price decline is related to changes in the price of polymer grade propylene feedstock. As the supply of propylene increases, the price of polymer grade propylene drops.
Under the influence of the price dip in December, the price of PP in North America fell by 6 cents/lb in 2018. In addition, the price decline was also affected by the increase in PP imports. Due to some production problems, the supply of PP in North America in 2018 was tight, and at the same time the price of imported resin was low, causing buyers to turn to foreign suppliers.
As of November last year, the amount of PP exports in North America fell by 32%, and local sales were flat, with overall sales falling slightly by more than 1%. However, market observers said that due to the increase in PP imports, the actual consumption of PP in North America in 2018 is likely to increase by 3% to 4%.
After the price of PE in all grades in North America fell by 3 cents/lb in November, the price in December continued to drop by 3 cents/lb. In the end of 2018, most PE grades in North America fell by 2 cents. /lb.
Market watchers believe that falling oil prices and lower global demand for PE (especially in the packaging market) are the main reasons for the fall in PE prices in November and December. Although most of the PE production in North America uses natural gas, the global resin market is still affected by oil prices.
As of November, sales of high-density polyethylene (HDPE) and linear low-density polyethylene (LLDPE) in the United States and Canada increased significantly, mainly due to strong demand in the export market, stimulated capacity growth, and strong local sales growth. According to the American Chemistry Council, HDPE's total sales in the region increased by nearly 13%, as domestic sales of HDPE in North America increased by more than 6% and exports increased by nearly 43%.
From January to November last year, the local sales of LLDPE in North America increased by more than 5%, the export volume surged by nearly 96%, and the overall sales jumped by 24%. Sales of low-density polyethylene (LDPE) grew more slowly, up only 5% in November, but exports rose by 21.5%.
In November, although the price of raw benzene dropped slightly, the price of solid PS remained stable, but it fell by 7 cents/lb in December. In the end of 2018, the solid PS price in North America fell by 6 cents/lb. .
In 2018, the sales of solid PS in North America underperformed. As of November, it has fallen by nearly 5%, but the export volume has increased by more than 13%, which has somewhat mitigated the impact of a 5.5% decline in local sales.
The price of PET resin for bottles fell by 4 cents per pound in December and fell by 6 cents per pound and 1 cent per pound in October and November, respectively. However, throughout the year of 2018, the price of PET resin for North American bottles rose by an average of 4 cents per pound.
Market observers believe that the main reason for the price decline in December is the decline in market demand for purified terephthalic acid and other raw materials and an increase in supply. In the autumn and winter, as the sales volume of bottled water and carbonated beverages declined, the demand for resin for bottles also decreased.
