Resin Raw Material Trend 2012-2013 for Plastic Injection Molding

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.