Market Report Plastics - November 2015
Information about the market for plastics is being presented by:
bvse - Bundesverband Sekundärrohstoffe und Entsorgung e.V.
1. The market for primary plastics
The world oil market is depicted daily on the TECSON website, cf. http://www.tecson.de/. Crude oil prices are the central economic indicator. They are tending to fall further. The average over the year is 55.30 US $ and the average over the last 100 days is 47.50 US $. Just a reminder: the crude oil price determines plastics prices in particular, across several stages. The stages are the crude oil price itself, the refinery products, the precursor products for plastic synthesis, followed by the new plastic and then finally the recyclate prices. However, the further we move away from the crude oil price in the chain above, the more other factors also come into play.
In this connection, I would once again like to draw attention to the mystery of petrol prices at the pump. Whereas the crude oil price has halved, petrol prices have remained more or less unchanged. Only the diesel price is following the trend of the changed primary quotes. The current petrol price formation is so remarkable because in times of high crude oil quotes, the petrol prices followed every increase. But this does not to appear to apply when the reverse is the case - why not? And let's imagine that the crude oil quotes are rising again; what will happen then...?
Standard plastics: In October and November demand for standard plastics has picked up markedly - Christmas business is just around the corner and plastics prices are very low now. However, the plastics processors' purchase orders could no longer be fully met. But in spite of the strong demand, the average price of standard plastics fell by some 71 /t to 1274 /t in October, cf. Table 1. Or to put it another way: within four months the plastics price has fallen greatly, by 286 /t. Particularly high price reductions can be seen for PS and PP, with an average of 165 /t and 100 /t respectively. The cheap precursor products are cited as the reason for the price reduction in October. And the precursor products follow the crude oil prices. For example, the average crude oil price over the last 100 days on 19 November 2015 was only 47.50 US $. Packaging PET, however, is rising slightly in price. At an average price of 1125 /t, it is listed at 10 /t higher than in the previous month.
For a detailed discussion, including details of price indices for virgin materials, waste plastics and precursors, please refer to EUWID Recycling und Entsorgung (EUWID Recycling and Waste Management) or EUWID Kunststoff (EUWID Plastics), cf. www.euwid.de and KI - Kunststoffinformation (KI Plastics Information), cf. www.kiweb.de.
Table 1: Standard plastics prices according to EUWID over the past five months, listed in /t.
Technical plastics: In October, the prices of technical plastics fell significantly, by an average 110 /t. Hesitant purchasing conduct has proved worthwhile for plastics processors. The prices of technical plastics are under tremendous pressure because of good supply and falling precursor product prices. PA 6 is quoted at 200 /t lower and PC has fallen by 125 /t.
Table 2: EUWID quotes for technical prices, which are published every two months, over the last six months; prices in /t.
2. The market for secondary plastics
Secondary plastics have once again been falling in price in November with satisfactory to good demand. Or to put it more clearly: secondary plastics are also following the prices of the new products and thus, ultimately, the crude oil prices and in this way are reaching historically low prices. Both price indices, i.e. plasticker and EUWID, show falling prices. Whereas plasticker identifies price falls of an average 18 /t for all standard plastics, the price reductions are much more moderate in EUWID. In EUWID the price falls for certain grades are 5 /t to 25 /t; however, some quotes have remained unchanged. In November and December, the situation on the secondary plastics markets will become unclear due to the forthcoming winter break: plastics processing is slowly reduced and warehouse stocks are used up. However, moderate plastics prices entice clients to buy.
Waste plastics: Demand for waste plastics is reported to have eased compared to the previous months. Processing input has already fallen in price for plastics recyclers. The supply of waste plastics is reported to be good. The prices are therefore likely to fall again in November. Export to the Far East is moderate. The reasons for this are the pending export and import licences for the People's Republic of China. Furthermore, strict import controls at all Chinese borders were announced for November and December. The People's Republic of China continues to buy only high-quality goods; poor-quality goods do not stand a chance in the export trade with the Far East.
Recyclates: Once again, the prices of recyclates are coming under pressure. The reasons, on the one hand, are the falling prices of virgin material and the excessive prices of processing input, i.e. waste plastic, on the other. However, it must also be remembered that the existing strong demand for virgin material could not be satisfied in October and November; for this reason, demand for recyclates remains strong.
2.1 EUWID Price Watch
The EUWID Price Watch indicates slight price falls for selected plastics. The price falls are in the range of 5 /t to 25 /t on average. Often only the upper or lower price limit changes. Some plastics have remained unchanged.
PE: All grades of post-industrial PE are quoted lower, by an average 10 /t to 20 /t. In October, this is: HDPE mixed colours 550-650 /t, HDPE natural 660-810 /t, LDPE mixed colours 480-630 /t, LDPE natural 700-830 /t, LDPE film mixed colours (K 49) 200-300 /t and LDPE film natural (K 40) 500-620 /t. There were price falls in post-user PE for a few selected grades, i.e.: LDPE shrink film natural (E 40) 500-530 /t, LDPE shrink film mixed colours (E 49) 230-300 /t, film transparent coloured <70 m 10-140 /t, HDPE blow-moulded mixed colours (C 29) 220-350 /t, HDPE crates colour-separated 670-790 /t and HDPE crates mixed colours 540-650 /t.
All grades of post-industrial PP are quoted lower, by an average 10 /t to 25 /t. This is a marked fall in prices which is due to a much greater supply of waste. There were the following changes in October: film mixed colours (K 59) 100-220 /t, film natural (K 50) 300-470 /t, homopolymer mixed colours 440-630 /t, homopolymer natural 650-830 /t, copolymer mixed colours 450-630 /t and copolymer natural 650-830 /t.
PVC: Only one price change has been seen in post-industrial PVC, i.e. plasticised transparent 330-430 /t, which is thus quoted by an average of 10 /t lower. The prices of PVC window frame regrind have fallen by 10 /t each at the lower end of the market: window grade white 560-650 /t, window grade mixed colours 460-550 /t, and window grade prime ware white 660-750 /t.
Post-industrial PS prices have remained unchanged. Because of the marked price changes for virgin grades, the prices of waste PS have come under pressure in November.
The PET recyclers' warehouses are now still replete with stocks in the autumn months. This will not change in the winter. The strong supply of used PET disposable bottles will lead to further price falls. The slightly higher prices of virgin grade give rise to hope that recyclate prices will remain stable. The EUWID listings for PET beverage bottles have fallen by 15 /t for PET transparent. The prices of PET mixed colours have not changed since the previous month.
2.2 plasticker price index
The plasticker internet platform, cf. http://plasticker.de, 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 November 2015. These listings thus merely reflect an interim situation that does not become definitive until December 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 October the average prices of standard plastics were quoted at 586 /t in plasticker and thus 18 /t lower than in the previous month. There are only slight price changes for the individual grades. The price rises range from 20 /t to 60 /t and the price falls from 10 /t to 90 /t. Demand for standard plastics in October was slightly lower than in the previous month. The price of HDPE regranulate has fallen by as much as 90 /t. PP regrind has made up for the price fall of the previous month and is now quoted 60 /t higher. PS regrind is quoted by as much as 70 /t lower than in the previous month. And at 360 /t, PET regrind mixed colours almost reached the historic low of February.
The first preview of the November listings, which cannot be definitively reported until the beginning of December, shows the prospective average price to be 587 /t. Thus, the plasticker internet platform indicates an average price that was unchanged on 16 November 2015. PS regrind has reached an 18-month low at 640 /t. Demand for standard plastics has been strong in November so far.
Table 3: Standard plastics price according to plasticker; listed in /t.
*: Supply figure 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 October the average prices of technical plastics were quoted at 1276 /t in plasticker; i.e. they had fallen 18 /t compared to the previous month. The price changes for the individual grades were on the moderate side. The price falls are in the range of 10 /t to 100 /t. Only PBT granulate is quoted 50 /t higher. Demand for technical plastics was satisfactory in October.
The first preview of the November listings, which cannot be definitively reported until the beginning of December, shows further falling prices with an average price of 1267 /t. Or to put it differently, the prices have fallen by a total of 43 /t from August, when they were listed 1310 /t, to November, when they were quoted at 1267 /t. PC regrind is once again at the lowest price of 870 /t, which it had already reached in July. At 620 /t, POM regrind almost reached the historic low of 590 /t. And this is also true for PC and PA 6 regranulates, which are currently quoted at 1860 /t and 1820 /t respectively and are thus not far off their historic lows of 1800 /t each. PA 6.6 has reached a historic low of 1850 /t. By 16 November 2015 the plasticker internet platform showed satisfactory demand for technical plastics.
Table 4: Technical plastics price according to plasticker; listed 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 (www.plasticker.de). The prices listed in this index are quoted without 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
