Market Report Plastics - March 2014

Information about the market for plastics is being presented by:
bvse - Bundesverband Sekundärrohstoffe und Entsorgung e.V.

1. The market for primary plastics

The Gesamtverband Kunststoffvearbeitende Industrie e.V. (GKV), the umbrella organisation of the German plastics-processing industry, made the following announcement in its press release of 5 March, cf. http://www.gkv.de. The industry, once again, ended the previous year with a record turnover. In total, it had achieved a three per cent growth rate by year-end.

According to reports by the umbrella organisation’s president Dr Bernd-O. Kruse, the industry’s turnover rose to a level of 57.6 billion euros in 2013 (2012: 55.9 billion euros). The president added that subsequent to restrained demand during the first few months, there had been steady growth in all essential segments of plastics recycling – packaging, building, consumer goods, technical parts. Kruse added that the fourth quarter had significantly surpassed all expectations with the “frenzied final spurt it performed in December”.

Due to the overall favourable economic situation, the GKV, once again, reckons with a further, slightly stronger growth in turnover for the current year. Dr Kruse explained that it would be possible to attain a four to five per cent growth rate in turnover.

Standard plastics: In February, the standard plastics prices listed by EUWID remained nearly unchanged compared to the previous month; standard plastics prices fell short of those quoted in the previous month by no more than 8 €/t. According to the Price Watch, there was a significant demand for standard plastics in the first part of the month and a considerably subsiding demand in the second. It is presumed that plastics processors are hoping for prices to fall further.

Table 1: Standard plastics prices listed by EUWID over the past four months; prices in €/t.

Technical plastics: In February 2014 technical plastics rose slightly by 22 €/t. However, in total the plastics quotes proved to be stable. Technical plastics have been in considerable demand since the beginning of this year. The slight price rise is explained by the increase in raw material costs. Experts even expect prices to have risen further by April. According to experts, the European domestic demand for technical plastics is now, once again, growing, too.

Table 2: Technical plastics prices, published by EUWID on a bi-monthly basis, over the past six months; prices in €/t

2. The market for secondary plastics

In February standard and technical plastics prices nearly held their own compared to the previous month – they may be assessed as being largely stable. Even secondary plastics seem to follow this trend. Nevertheless, special attention should be paid to technical plastics: in the secondary market technical plastics prices seem to be collapsing, whereas they are still holding their own in the primary market.

The Green Fence Policy of the People’s Republic of China is still showing some effect, albeit to a lesser extent. For instance, merchants and sales agents are criticising excessive requirements from China, which only accepts high-quality goods. Furthermore, there are reports that the freight charges are climbing. In addition, the Far East is reportedly paying less for standard plastics. As a result of the increased dollar exchange rate, export prices are rising.

According to the EUWID magazine, standard plastics for February 2014 only changed relatively slightly compared to January 2014. The plasticker internet platform shows the same price development. The demand for standard plastics is assessed as being favourable by both price indices. In total, the price changes can be assessed as being minimal and thus, as indicating price stabilisation for February 2014.

2.1 EUWID Price Watch

PS and PVC have held their own according to EUWID, whereas the standard plastics PE and PP show only very minimal price changes in the lower or higher price range, i.e. the prices have risen by 10 €/t. This time it really involves hard work to list the slight changes that have occurred since the previous month.

The PE price has slightly risen. The changes often involve price rises by 10 €/t in the lower or higher price range. In March experts expect film waste prices to fall. The following post-industrial PE listings changed in February: HDPE mixed colours 480 - 650 €/t, HDPE natural 640 - 760 €/t, LDPE mixed colours 480 - 600 €/t, LDPE natural 650 - 750 €/t and LDPE film natural (K49) 480 -600 €/t. The following post-user PE listings changed in February: LDPE shrink film natural (E40) 500-5600 €/t, film transparent natural <70 µm 400 - 440 €/t, film transparent mixed colours <70 µm 40 - 170 €/t, LDPE farm film black/white > 70 µm 30 - 50 €/t, HDPE hollow bodies mixed colours (C29) 150 - 280 €/t, HDPE regrind from crates, colours-separated 650 - 820 €/t and HDPE regrind from crates, mixed colours 550-620 €/t.

The price changes in post-industrial PP include three PP quality grades. In these cases the price rises range between 5 €/t and 15 €/t on average. The following listings have changed: film mixed colours (K59) 130 – 250 €/t, film natural (K50) 320 – 450 €/t and homopolymer mixed colours 450 – 620 €/t. As far as PP is concerned, there are two very different offers for regrind and regranulates in terms of quality: while some of the PP producers tend to launch low-quality materials onto the markets, others produce higher-quality goods, few of which, however, attain adequate prices. On the whole, the PP markets have, none the less, stabilised – sufficient supply is matched with good demand.

According to the Price Watch, post-industrial PS has not changed. PS recyclers are still looking for processing input. The demand for PS regrind and for PS regranulates in particular continues to be high. PS regranulates attain good prices, cf. the price index in plasticker. PVC: The mild winter and the favourable weather conditions at the beginning of this year almost prevented the usual decline in demand from taking place.

The PET market: There is still a sufficient supply of PET beverage bottles. Recyclate sales, i.e. the regrind and regranulates sales, are satisfactory. According to EUWID, the PET prices rose by 5 €/t compared to the previous month in February 2014. While transparent PET beverage bottles were quoted at a slightly higher price in the EUWID Price Watch of February, the price slide in PET bale goods still continues according to the plasticker internet platform. The following new prices are thus quoted by EUWID: PET transparent 250-290 €/t and PET coloured 60 - 95 €/t. As far as PET virgin materials are concerned, there are reports according to which the prices of packaging PET fell by an average 25 €/t in February.

2.2 plasticker price index

The plasticker internet platform publishes quotes on an hourly basis. However, the present market report shows the final monthly prices. The preliminary quotes previously accumulated are only represented during the reporting month in question, in this case for March 2014 - these quotes merely reflect an interim situation that does not become definitive until the following month.

Standard plastics

In February standard plastics prices held their own compared to the previous month. Nevertheless, the prices of the individual quality grades changed: thus, price rises ranged between 10 €/t and 70 €/t, while price decreases ranged from 20 €/t to 40 €/t. The February demand slightly increased compared to January. LDPE bale goods and LDPE regranulates attained good prices, while LDPE regrind was traded at a slightly lower price. Even PP bale goods and PP regranulates can be purchased at favourable price in the markets. Mixed-coloured PET regrind has bottomed out. According to plasticker the following price listings changed by more than +/- 40 €/t in February compared to the previous month: HDPE regrind + 60 €/t and PS regranulates 70 €/t.

The first preview of the 2014 March quotes, which will not be finally reported until April 2014, indicates a prospective average price of 604 €/t. Hence, the plasticker internet platform indicated a slight price rise in standard plastics on 14 April 2014. In March, the demand for standard plastics has, until now, been no more than satisfactory.

Table 3: Prices of standard plastics in plasticker, quoted in €/t

*: Supply figures too low to attain statistical significance; 1: equivalent to the grade "post-industrial, mixed colours"; 2: equivalent to K49; 3: equivalent to K59; 4: equivalent to "standard, mixed colours"; 5: equivalent to the grade "regranulates, black", 6: forecast (likely to be amended by additional quotes)

Technical plastics

In February 2014 the quotes for technical plastics fell by an average 39 €/t compared to the previous month. The listings for technical plastics – with the exception of PA 6.6 - decreased, with price changes ranging between 10 €/t and 120 €/t. According to plasticker the following price quotes changed by more than +/- 70 €/t for: ABS regrind - 120 €/t and PC regranulates – 180 €/t. The February demand can be assessed as having been satisfactory.

Please note: there is a considerable price slump in technical plastics imminent in March! The first preview of the March quotes for 2014, which will be finally reported at the beginning of April, shows an average price of only 1322 €/t. Hence, the March quotes for technical plastics listed by the plasticker internet platform on 14 March 2014 have fallen by € 85! In March there has been restrained demand for technical plastics until now. However, this is also a chance to purchase technical plastics at favourable prices!

Table 4: Prices of technical plastics in plasticker, quoted in €/t

5: equivalent to the grade "regranulates, black". 6 forecast (likely to be amended by additional quotes)

No guarantee for any of the prices. All EUWID prices are quoted ex works. As a rule, the prices quoted refer to quantities in excess of 20 tons. The monthly quotes for secondary plastics, which are updated on an hourly basis, can be calculated using the price lists that are derived from the quotations published in the raw material exchange plasticker. The prices listed in this index are quoted with reservation - as the majority of the quotes submitted are not necessarily equivalent to the sales prices. Furthermore, plasticker does not distinguish between the following grades: transparent, mixed colours or colour-separated. Therefore, the information provided by plasticker may indicate different market behaviour than the prices quoted by EUWID. Plasticker offers the quality grades regrind and regranulates in the form of both virgin materials and secondary materials.