Market Report Plastics - February 2009
Information about the market for plastics is being presented by:
bvse - Bundesverband Sekundärrohstoffe und Entsorgung e.V.
1. The market for primary plastics
The rapid decline in prices in the primary market for standard plastics is slowing down. Various measures to decrease the supply of goods, such as suspending production, reducing production as well as bringing forward maintenance breaks, have had a positive effect. Since the end of January stocks have been been replenished, which has boosted demand. However, it remains unclear whether the February quotes have brought about a lateral shift, i.e. an interim high, or whether the basic level of prices has been attained. The level of demand is largely based on the consumption of plastics by private households, which arises from the use of packaging materials (33%), electronic equipment (7 %), household goods (3%) and furniture (4%). Plastics manufacturers are trying to increase the prices of standard plastics by 100 /to.
According to the EUWID Price Watch the average January quote for the ten types of plastics listed below is 810 /to, thus falling short of the previous month by 51 /to. The price index for standard plastics shows the following price quotes: LDPE film grade 750-850 /to, LLDPE film grade 750-850 /to, HDPE injection moulding 750-800 /to, HDPE blow moulding 750-800 /to, PS general purpose 760-820 /to, PS high impact 820-890 /to, PP homopolymer 750-850 /to, PP copolymer 800-900 /to, PVC tube grade 790-830 /to, PVC film/cables 830-870 /to. The quotes for LDPE plastics remain unchanged compared to the previous month. PET: In February packaging PET is quoted at 930 - 980 /to, thus falling short of the previous month by 70 /to on average. There is still a wordwide excess supply of PET.
The situation on the London Metal Exchange (LME) is inconsistent. The quotes submitted here are average values based on LME purchase and sales prices. In week 6 the purchase prices of PP for February, March and April were at 785 US-$, 790 US-$ and 790 US-$ respectively, whereas those of LLDPE were at 650 US-$, 660 US-$ and 670 US-$ respectively. Thus February quotes for PP decreased by 15 /to compared to the previous month, whereas those for LLDPE decreased by 80 /to. Hence, the development of PP on the LME has stabilized, whereas the quotes for LLDPE continue to decrease. Some experts believe that the price decline in standard plastics has ground to a halt.
2. The market for secondary plastics
The global financial crisis still plays a crucial role in plastics recycling in February. The downward trend of the markets for secondary plastics continues. Unfortunately, there are still reports of insolvencies. The low domestic demand as well as the distinctly reduced market development can also be regarded as negative factors. However, the fact that trade and commerce are gaining in importance again can be seen as a positive trend. In the meantime it has become much easier to determine the value of recyclates than in previous months. The demand from the Far East is also increasing again; apparently, stocks are being replenished. However, experts differ in their assessments as to the continuation of this positive trend in exports to China. On the whole, this implies that an interim high has been reached.
2.1 EUWID Price Watch
At first sight, the EUWID Price Watch is inconsistent: the decline in the prices of the majority of plastics has slowed down distinctly, whereas the quotes for some plastics have remained unchanged; and in some cases, prices have even been increased. The Price Watch is largely based on a low trading volume.
Again, the prices of PE post-industrial wastes, i.e. of relatively high-grade regrind, have decreased considerably: HDPE mixed colours 300 500 /to, HDPE natural 400 580 /to, LDPE mixed colours 250 - 400 /to, LDPE natural 400 500 /to, LDPE film mixed colours (K49) 200 250 /to and LDPE film natural (K40) 300 450 /to. The price of low-grade LDPE has fallen by 150 E/to! The tremendous decline in the price of LDPE film is put into perspective by the fact that price quotation was suspended in December. For the most part, the prices quoted for PE post-user goods are firmer; with the exception of farm film and hollow bodies, which are quoted at a lower price, and except for regrind from crates, whose price has remained unchanged, the prices of PE post-user goods have even increased. This effect is due to the export demand from the Far East. The January quotes are: LDPE shrink film natural (E40) 230 280 /to, LDPE shrink film mixed colours (E49) 150 200 /to, LDPE stretch film natural (E70) --- /to, film transparent natural <70 mm 150 220 /to, film transparent coloured <70 mm 10 80 / to, LDPE farm film natural <70 mm (B40) 30 - 0 /to, LDPE farm film black or white > 70 ΅m (B41) 0 20 /to, mixed film (90/10) 80 - 150 /to, mixed film (80/20) 40 - 90 /to, HDPE hollow bodies mixed colours (C29) 0 - 80 /to, HDPE regrind from crates colour-separated 400-500 /to and HDPE regrind from crates mixed colours 300 450 /to.
PP: The PP markets are stagnating; they show a low demand and low sales. The decline in prices continues: Film mixed colours (K59) 0 - 100 /to, film natural (K50) 150 200 /to, homopolymer mixed colours 300 450 /to, homopolymer natural 400 500 /to, copolymer mixed colours 350 450 /to, copolymer natural 400 550 /to, injection moulding --- /to. The price quotes for homopolymer natural and copolymer mixed colours remain unchanged. The decline in prices is expected to continue next month as well.
PS: Prices on the PS markets were stable in January. Standard mixed colours 400 500 /to, standard crystal clear 400 500 /to, standard white 450 550 /to, high impact mixed colours 350 550 /to, high impact black 350 500 /to and high impact white 450 600 /to. Sales were also on the decline in this segment.
PVC post-industrial wastes: The prices of PVC-U and PVC-P transparent are still not quoted. Apart from that, prices are quoted as follows: PVC-U mixed colours 250 350 /to and tube grade mixed colours 250 350 /to. The prices of PVC-windowframe regrind remain unchanged: Windowframe regrind white 620 660 /to, windowframe regrind mixed colours 320 500 /to and windowframe regrind single-shade white 660 800 /to. The PVC segment still shows an amazing degree of stability; however, this segment is also expected to undergo further changes, as the construction industry is on the decline.
PET post user: The Price Watch shows that the prices of PET have remained unchanged; they are quoted as follows: PET single-use bottles natural 100 160 /to and PET single-use bottles mixed colours 0 60 /to. However, it is insufficient to describe the PET market solely on the basis of the above quotes. Buyers are determining prices now, and they are also doing so with respect to supermarket chains. Only high-quality goods can still attain correspondingly high prices.
2.2. plasticker price index
The price quotes for secondary plastics can be calculated on the basis of plasticker (cf. www. plasticker.de). 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. Therefore, the information provided by plasticker indicates distinctly different market behaviour than the prices quoted by EUWID. At first sight, the February quotes reveal a tendency towards a further decline in prices by 10 50 /to for many standard plastics, i.e. a decline in a weaker form. Hence, it can be presumed that the price development has not bottomed out yet and that the prices quoted will thus continue to decrease in the next couple of months.
Hence, the following price changes greater than/less than 40 /to can be reported for standard plastics compared to December: HDPE regrind 50 /to, HDPE regranulates 120 /to, LDPE regrind 70 /to, LDPE regranulates 60 /to, PP regrind 50 /to, PP regranulates 110 /to as well as PET regrind 50 /to. The following changes greater than/less than 70 /to can be reported for technical plastics compared to December: PC regrind 100 /to, PA 6 regranulates 200 /to as well as PA 6.6 regranulates 280 /to.
Price index for standard plastics January 2009, as derived from www.plasticker.de
The EUWID price quotes refer to bale goods or regrind. The given prices were quoted for business transactions between sorting plants and sales agents or the processing industry, as the case may be. As a rule, prices refer to quantities in excess of 20 to ex works. The prices attainable in trade can differ considerably from the indicated price range in both directions, depending on the grade of the type of plastic material quoted. The abbreviations used for some grades refer to the list of waste plastics published by the German Federal Association for Secondary Raw Materials and Waste Disposal (bvse)/Bureau of International Recycling (BIR).
