Report ponders plastics pricing issues

Higher feedstock costs and strong export demand drove polyethylene prices up 22¢/lb last year, according to a January 6, 2005 Market Update from The Plastics Exchange.

The update evaluates current market conditions affecting resin producers and processors. Regarding polypropylene, the report says, “the [PP] market had a great run in 2004 and if [resin] producers have their way, prices will continue higher into 2005.”

TPE called 2004 “a wild ride” for polystyrene, with prices rising nearly 70%. “Runaway benzene prices” drove those PS increases. “More recently,” the update says, “benzene prices have fallen dramatically. This easing of prices is welcome relief to resin processors, particularly those that manufacture commodity-type products. They have done their best to push the higher resin prices along to their customers of finished products, but competition during this period of economic recovery, especially from overseas, has made this difficult. Unfortunately, some companies have not survived and the industry continues to see consolidation. It seems that the tide has turned and hopefully the industry will continue to see lower feedstock and resin prices ahead,” said Michael Greenberg, The Plastics Exchange’s CEO.

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