Market Report Plastics - December 2014
Information about the market for plastics is being presented by:
bvse - Bundesverband Sekundärrohstoffe und Entsorgung e.V.
1. The market for primary plastics
According to the end-of-year review published by Kunststoff Information, see www.kiweb.de, the plastics industry is mostly satisfied. The first half-year of 2014 was marked by relatively strong demand for plastics, while the second half-year is deemed to have consolidated at a high level. However, Kunststoff Information also points out that the political course taken has led to the parameters increasingly changing to the detriment of plastics production and plastics processing. The factors held responsible for this development include, among others, the hesitancy in reimbursing the increased electricity costs based on an EEC levy, the so-called “ban on plastic bags” as well as the increasing rise in the costs of plastics production in Europe, which is caused by comprehensive statutory requirements and increased production costs.
Standard plastics: Plastics precursor prices have been falling as a result of the slide in the oil price. In November standard plastics prices fell significantly short of those quoted in the previous month, i.e. by an average 39 €/t, see Table 1. Prices are likely to fall further in December. This is explained by the price slides in the mineral oil chain, falling demand on the processors’ part and the considerable supply of plastics. The imminent winter break is likely to consolidate the markets.
Table 1: Standard plastics prices listed by EUWID over the past four months, quoted in €/t.
2. The market for secondary plastics
In the fourth quarter the secondary plastics markets have been subject to great turbulence. In November and in December in particular there have been considerable market distortions. Sinking mineral oil prices have been dragging the entire plastics chain down. While recyclate prices have come increasingly under pressure, the prices of processing input, i.e. bale goods in particular, have remained high. This is why plastics recyclers have run into considerable trouble.
There is a great lack of processing input for plastics recycling. In addition, the quality of the separated goods can, for the most part, only be described as being very poor. Significant quantities of sales packaging from Dual Systems are being shifted to other countries in a targeted manner. For this reason, processing is only possible based on subcontracting. Considerable distortions have also been discernible in the PP and PS markets for some time, where there is, in particular, a lack of processing input. For the time being, DSD GmbH is only supplying its own processing plants with waste plastics. The quotas allocated to the other plastics recyclers for 2015 are being cancelled on a large scale. This is why additional plant closures are imminent.
Furthermore, an increasing amount of plastics is, once again, being exported to the Far East. The export trade with the Far East is subject to waste plastics prices that European plastics recyclers can no longer afford to pay. Hopes are being set on the Chinese New Year’s celebrations, which are likely to calm the demand from the Far East down. The Chinese New Year will be celebrated on 19 February 2015.
There are few indications of the winter break being imminent. Those plastics processors who are lucky enough to have sufficient processing material at their disposal are continuing production up to and including 23rd December. Increased purchasing and sales activity is observable in the plastics markets.
According to both EUWID and plasticker, standard plastics prices have remained stable in the secondary markets. The above market distortions are not mirrored by the price indices to date. The economic developments in the building sector stabilised PS and PVC prices at the previous level in November, too. There is still considerable demand for PS, which can be processed in numerous ways.
2.1 EUWID Price Watch
In November the EUWID Price Watch for waste plastics showed that prices had remained unchanged. Only the price of thick LDPE farm film rose by 15 €/t.
The PET market has been troubled in November and December, too. Regranulates are having a hard time competing against virgin material prices. Primary PET prices for packaging PET amount to 1190 €/t, showing a continuous tendency towards decrease. The price relationship between virgin materials and regrind is slightly better for flake producers. At present there are massive market changes underway in Germany. Independent PET recyclers are faced with a diminishing amount of processing goods, whereas PET recyclers affiliated to a corporate group are themselves reprocessing the beverage bottles in circulation. The EUWID quotes for beverage bottle PET have held their own in December: PET transparent 240-265 €/t and PET coloured 50-70 €/t. Or to put it differently: the price quoted for PET transparent and PET coloured has each fallen by an average 15 €/t compared to the previous month.
2.2 plasticker price index
The plasticker internet platform publishes quotes on an hourly basis. The present market report indicates the final monthly prices. It is only possible to represent the preliminary prices for December 2014. These listings thus merely reflect an interim situation that does not become definitive until January 2015. Plasticker offers the quality grades regrind and regranulates both as virgin materials and as secondary goods. The term “bale goods“ refers to waste plastics only.
Standard plastics
In November the average standard plastics price, see Table 2, remained almost unchanged compared to the previous month. The prices of individual quality grades changed only slightly. Thus, price rises and price falls range from 10 €/t to 40 €/t. In November demand for standard plastics was relatively restrained. HDPE regrind is still undergoing an upward trend. The HDPE regranulate price has been steadily falling since it reached its annual peak in August at 1010 €/t. PP bale goods are in great demand; the listing has increased considerably over the past three months. PS regrind attained record prices in November, reaching 880 €/t. The price of PET regrind mixed colours has been falling over the past twelve months.
Table 2: Standard plastics prices according to 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: preview (may be amended by additional quotes)
Technical plastics
In November the average technical plastics price rose by 29 €/t compared to the previous month, see Table 3. Technical plastics stabilised at the price level attained. The following price changes apply to the individual quality grades: price rises range from 40 €/t to 150 €/t and price falls from 10 €/t to 110 €/t. ABS regrind, PC regrind and POM regrind have shown a trend towards falling prices over the past year. In November, too, there was restrained demand for technical plastics. According to plasticker the following price quotes changed by more than +/- 70 €/t: ABS regrind -110 €/t, PC regrind + 150 €/t, PA 6.6 regranulate + 110 €/t and POM regranulate + 90 €/t.
The first preview of the December quotes for 2014, which will not be definitively reported until the beginning of January 2015, shows the average price to be 1330 €/t. Thus, technical plastics have been stabilising. Until 12 December 2014 the plasticker internet platform showed restrained demand for technical plastics.
Table 3: Prices of technical plastics in plasticker, quoted in €/t
5: equivalent to the grade "regranulates, black". 6 preview (may 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 (cf.). 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.
