Volume: Growing
Price: Steady, some lower
The spot Polyethylene market was slow most of the past week. Producer offers were limited as would be expected for the beginning of a month when there is not only one, but two price increases nominated. Traders, however, have had little confidence in the $.09/lb in play, so they have been offering out their inventories for the past two weeks. With export sales a little hard to come by, producers silence did not last long and a fair amount of offers began to show in the later part of the week.
The accompanying charts display The Plastics Exchange generic prime offering price for railcars of HDPE injection grade. They show that the market gave back early August gains during the second half of the month and have remained only steady through the first week of September. Given that the spot market remains well supplied with competitively priced resin, there is currently none of the September price increases built into the market, which is an indication that at this time there is little risk of them becoming implemented.
Export interest out of the US has not fully recovered after the lull in August. European spot Polyethylene prices have eased, and producers were slow to respond with lower export prices. With this supporting base of demand on unsteady ground, bullish momentum has stalled and has begun to reverse. Houston export offers have recently come off several cents and are starting to attract some renewed buying interest at the lower levels.
While the Polyethylene market in general has loosened up, certain grades are still hot, characterized by both sparse supplies and eager demand. LDPE, particularly High Clarity and Heavy Duty film grades, are basically not to be found in the spot market. Each reasonably priced lot that has appeared has promptly been sold. Unrealistic offers have also shown, but there has been a limit to what buyers of even a hard-to-find resin will pay.
Supplies of all commodity grade HDPE resins have become more available. Injection and blow molding prices have softened, especially for export. HMW film grade offers have come along more frequently, and while their prices have so far only come off slightly, the premium it holds to other Polyethylene grades seems fully extended and perhaps vulnerable.
Many market participants had felt that Polyethylene prices would have continued higher in September, but current conditions remind us how just a subtle shift in psychology can alter a market. When sentiment began to shift, buyers backed away from their more aggressive purchasing behavior, which reduce very short term demand. Without a wide open export outlet, as producers' inventories and anxiety built, offer prices were reduced to help move the product.
It is still early in the month, so things could change, but at the moment, even with just a week of September under our belt, it seems that (most/all of) the $.09/lb of current price increases will likely be pushed off.
Price: Steady, some lower
The spot Polyethylene market was slow most of the past week. Producer offers were limited as would be expected for the beginning of a month when there is not only one, but two price increases nominated. Traders, however, have had little confidence in the $.09/lb in play, so they have been offering out their inventories for the past two weeks. With export sales a little hard to come by, producers silence did not last long and a fair amount of offers began to show in the later part of the week.
The accompanying charts display The Plastics Exchange generic prime offering price for railcars of HDPE injection grade. They show that the market gave back early August gains during the second half of the month and have remained only steady through the first week of September. Given that the spot market remains well supplied with competitively priced resin, there is currently none of the September price increases built into the market, which is an indication that at this time there is little risk of them becoming implemented.
Export interest out of the US has not fully recovered after the lull in August. European spot Polyethylene prices have eased, and producers were slow to respond with lower export prices. With this supporting base of demand on unsteady ground, bullish momentum has stalled and has begun to reverse. Houston export offers have recently come off several cents and are starting to attract some renewed buying interest at the lower levels.
While the Polyethylene market in general has loosened up, certain grades are still hot, characterized by both sparse supplies and eager demand. LDPE, particularly High Clarity and Heavy Duty film grades, are basically not to be found in the spot market. Each reasonably priced lot that has appeared has promptly been sold. Unrealistic offers have also shown, but there has been a limit to what buyers of even a hard-to-find resin will pay.
Supplies of all commodity grade HDPE resins have become more available. Injection and blow molding prices have softened, especially for export. HMW film grade offers have come along more frequently, and while their prices have so far only come off slightly, the premium it holds to other Polyethylene grades seems fully extended and perhaps vulnerable.
Many market participants had felt that Polyethylene prices would have continued higher in September, but current conditions remind us how just a subtle shift in psychology can alter a market. When sentiment began to shift, buyers backed away from their more aggressive purchasing behavior, which reduce very short term demand. Without a wide open export outlet, as producers' inventories and anxiety built, offer prices were reduced to help move the product.
It is still early in the month, so things could change, but at the moment, even with just a week of September under our belt, it seems that (most/all of) the $.09/lb of current price increases will likely be pushed off.
