Volume: Lower
Price: Higher
The Polypropylene market continued to exhibit strength this past week, as buyers have pursued spot lots, both good offgrade and generic prime, that are priced competitively to higher contract prices. October Polymer Grade Propylene (PGP) contracts have mostly settled $.03/lb higher, so Polypropylene producers are compelled to also raise resin contracts to maintain their minimal, yet acceptable, production margins.
There was a normal flow of good widespec material offered this week and much of it moved swiftly. Spot prices were bid up during the week and now stand in record territory for normal market conditions. Processors were good buyers, as were domestic resellers that have some supply gaps to fill. Many market players had drawn down inventories and still have some catch-up to play.
International resin inquires were good this week, but few Polypropylene trades were concluded. Current asking prices have been raised to a level that is difficult to export. The Asian arb is closed. The price to Europe can still work, but serious logistics limitations have traders worried about these particularly thin margin deals. The next best opportunities have been to Mexico, but their local prices have now dropped.
Overall Polypropylene supply/demand fundamentals lean in favor of producers. They are again dealing with rising feedstock costs, and will most likely collect their (on average) $.03/lb increase for October contracts. The resurgence in domestic processor demand has been refreshing, perhaps they are becoming accustomed to prices above $.60/lb, which had been a psychological ceiling.
Price: Higher
The Polypropylene market continued to exhibit strength this past week, as buyers have pursued spot lots, both good offgrade and generic prime, that are priced competitively to higher contract prices. October Polymer Grade Propylene (PGP) contracts have mostly settled $.03/lb higher, so Polypropylene producers are compelled to also raise resin contracts to maintain their minimal, yet acceptable, production margins.
There was a normal flow of good widespec material offered this week and much of it moved swiftly. Spot prices were bid up during the week and now stand in record territory for normal market conditions. Processors were good buyers, as were domestic resellers that have some supply gaps to fill. Many market players had drawn down inventories and still have some catch-up to play.
International resin inquires were good this week, but few Polypropylene trades were concluded. Current asking prices have been raised to a level that is difficult to export. The Asian arb is closed. The price to Europe can still work, but serious logistics limitations have traders worried about these particularly thin margin deals. The next best opportunities have been to Mexico, but their local prices have now dropped.
Overall Polypropylene supply/demand fundamentals lean in favor of producers. They are again dealing with rising feedstock costs, and will most likely collect their (on average) $.03/lb increase for October contracts. The resurgence in domestic processor demand has been refreshing, perhaps they are becoming accustomed to prices above $.60/lb, which had been a psychological ceiling.
