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Resin Raw Material Trend 2012-2013 for Plastic Injection Molding

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Crescent Industries, Inc.

70 East High St., New Freedom, PA, 17349, USA

Original Press Release

Resin Raw Material Trend 2012-2013 for Plastic Injection Molding

Press release date: November 21, 2012

The sale price of polypropylene resin rose two cents per pound in October. This follows closely on the foot-steps of a rebound caused by the tumbling 27 cents per pound that happened in May and August. In the last two months the price per pound settled to an average per pound of three cents.

Market sources report the increase comes from tighter supplies of resin and propylene monomer feedstock and strong per-pound demand growth generally in North America. Export sales declined by 15 percent, although in September the price per pound sales in US/Canada were up almost three percent.

Market analyst Scott Newell reported that regional demand would likely be "balanced through the rest of the year." "In general" Resin Technology Inc's analyst stated "growth should be positive for the year."

Resin prices have followed monomer prices for the past few years. Price increases of 5-7 cents per pound have been nominated for propylene monomer in November. Newell says this could be a changing trend as the resin market is growing tighter as operating rates are approaching 90 percent.

Producers are working to change contracts going into 2013 so that monomer prices will rally and profit margin expansions can take place. Because resin supply is tightening, there are better chances of growing this margin.

Two major plants went down during hurricane Sandy; Braskem Americas in PA and Sunoco 66 in New Jersey. They have now regained power but neither are producing resin as of November 8th. They should be back into production in a few more weeks. These closings represent 1.5 billion pounds of combined production capacity.

According to Frank Esposito, writer for Plastics News, September brought an increase of 23 percent for US/Canadian sales to injection and insert molding cups and containers which catapulted this category into the fastest growing PP end market. There was a 15 percent increase to PP compounders in this region as well.

Polycarbonate
With PC the shaky demand caused a downtrend of 8 cents per pound which is a four percent drop in the PC grades for injection and insert molding since May. Mark Kallman of RTi says that global demand is softer because producers are uncertain about the future demand. The good news is that there is a lot of increased capacity overseas, especially Saudi Arabia.

ABS
ABS regional prices have fallen by net decreases of 4 cents per pound since Jan 1. A 20 cent run-up was wiped out by those recent price declines. The drop means a 3 percent decline in price for high-impact ABS grades used in injection and insert molding, according to Plastics News.

ABS end markets haven't grown much due to the competitive Asian markets and lowered feed costs, according to Stacy Shelly of Resin Technology Inc of TX. She asserts that Asian markets may have hit bottom in August yet holds great optimism about the demand in auto markets during fall. ABS operating rates are expecting 2012 production to provide 1 billion pounds on a base of 1.8 billion pounds of nameplate ABS capacity. The North American operating rates are at about 60 percent currently.

Nylon
About 40 percent of regional nylon demand is taken by the automotive markets. Since auto builds are up more than 10 percent, some are hoping this will help lift prices.

According to Plastics News, regional prices saw net decreases of 5 percent with an 11 cent drop since January. Drops in nylon 6/6 was less. Regional prices for Nylon 6 increased in the second quarter. They dropped soon after according to Paul Blanchard, engineer plastics director of HIS chemical in Houston.

Polyethylene
Polyethylene industries experienced a strong global growth over the last five years. This growth is expected to continue advancing to about US 148.1 billion in 2017 with a CAGR of 3.5% over the next several years.

New product innovation, processes, and feedstock technologies will help major players recapture market share. Government stimulus for infrastructure in the piping sector of the industry caused a steady growth increase for 2010.

Introduction of ultra-high molecular-weight polyethylene and surgarcane-based polyethylene are the newest emerging trends. They are expected to have a significant effect on the future growth in the industry.

According to a study published in Lucintel Global Polyethelene Industry 2012-2017: Trend, Profit and Forecast Analysis; innovations in packaging, rising population and living standards as well as growing demand in end user markets with emerging economies will provide a boost the industry.

Polystyrene
Polystyrene (PS) has been called one of the world's top 5 most commonly produced plastics. It is a polymer made from styrene.

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