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Resin Price Report: Trading Pace Eases as Lazy Days of Summer Roll In
By PlasticsToday Staff
The unseasonal strong demand in spot resin markets that marked the first part of this month stepped back the week of July 15, reports the PlasticsExchange in its Market Update. The spot resin markets began and ended the week slowly but managed to confirm significant volumes along the way. The trading pace has eased, as production and logistics returned toward normal following Hurricane Beryl.
Series of notable events creates sense of unease.
It was a tense trading week, which brought sporadic spurts of activity and solid volumes, but also periods of quiet as participants evaluated a series of noteworthy events, according to the PlasticsExchange. Those events included the assassination attempt of former President Donald Trump, heightened tensions in the Middle East, volatile monomer markets, sliding international ocean freight rates, lack of fresh resin supply in the aftermath of Beryl, and worldwide tech outages that grounded more than 3,000 flights, closed the port of Houston for a brief period, and created an overall sense of vulnerability and unease.
Spot PE, PP prices pull back $0.01/lb.
Market sentiment turned cautious, notes the PlasticsExchange. Resellers were eager to keep resin moving, and spot polyethylene (PE) and polypropylene (PP) prices pulled back an average of $0.01/lb. PE trading hummed along, with domestic business at the PlasticsExchange trading desk regaining dominance over offshore sales. Low-density PE for film remains snug and linear-low-density PE 20 melt granular is virtually non-existent. Exporters competed for high-density PE Blow Molding in an auction that garnered a higher price than expected. Other spot export asking prices from the United States continued to rise and offers were very limited.
Cheap Chinese resin gets attention.
International resin buyers took a step back from chasing US material, as a cheaper set of Chinese offers made its way into Latin America, supported by softer, though still greatly elevated, ocean freight rates. There is mounting concern that China, which is burdened with overcapacity in plastics production, will start dumping resin on the world market. While shipping delays and long transit times from Asia persist, Latin American buyers were emboldened. It will be interesting to see if North American PE producers react quickly to maintain their high levels of exports, writes the PlasticsExchange. Otherwise, it adds, if operating rates remain robust, inventories can build fast.
Producers remain firm on implementing at least a $0.03/lb domestic contract increase that carried over from June. It seems likely to take hold this month, but it will take something special to realize the next $0.10/lb, as there is a nickel on the table for July and August.
Robust domestic demand for PE resin.
Domestic PE demand has been particularly good for the past four months, as sales have averaged 4.7% above the trailing 12 months. PlasticsExchange customers have not only increased their order flow and volumes, said the resin clearinghouse, but also comment about better throughput and their own increased customer sales. Some of the extra buying has also served to replenish downstream resin stocks after a long period of destocking, which seemed to last up to Q4 of 2023. The 2024 hurricane season has been widely forecasted to be extreme and it made sense for market participants to build an inventory buffer as a hedge against production disruptions and potentially escalating prices.
PP transactions tepid.
PP activity transacted at a more tepid rate with the bulk of transactions at the PlasticsExchange completed in the middle of the week. Overall availability has been light all month, good copolymer (Co) PP railcars continued to sell in a flash while traders and processors pecked away at Prime homo-polymer (Ho) PP truckloads, as needed. Spot HoPP and CoPP pricing peeled off a penny, as the ferocity of demand dropped off, relieving a little of the premium for prompt material. Some export PP cars emerged for late July production at prices about a nickel higher than they were a month ago. They were not particularly well received, noted the PlasticsExchange.
This contributed to a minor sell-off in propylene this week, as incremental PP exports have supported polymer-grade propylene (PGP) prices, and someone seemingly chose to liquidate some monomer rather than turn it into pellets.
The PGP selloff was quick and prices firmed right back up by the end of the week, as monomer supplies remain tight. In the meantime, July PP contracts are leaning toward a moderate single-digit increase. The PlasticsExchange said it maintains its estimate for a clean cost-push nickel hike reflecting higher PGP levels during the month. Producers have been seeking an extra $0.03/lb increase to expand margins, but a net $0.08/lb hike in July seems like a bit of a reach.
To read the full Market Update, go to the PlasticsExchange website.
White House Sets Path to Circular Economy
“Communities across the United States and around the world are facing a plastic pollution crisis.” Thus begins a fact sheet issued late last week by the White House outlining plans by the federal government to reduce plastic pollution in the United States and curtail consumption of single-use plastics.
The Biden-Harris administration said in the statement that it is releasing the “first comprehensive, government-wide strategy to target plastic production, processing, use, and disposal.” In addition to publishing “Mobilizing Federal Action on Plastic Pollution: Progress, Principles, and Priorities,” the White House also announced a goal to phase out federal procurement of single-use plastics. The communication dated July 19 commits the federal government to the elimination of single-use plastics from food service operations, events, and packaging by 2027 and from all federal operations by 2035.
What would Trump do?
The fact sheet was published before President Biden announced his withdrawal from the 2024 race for president, but there is no reason to think that de facto Democrat nominee Vice President Kamala Harris would reverse this decision or alter the roadmap to a circular economy outlined in the 82-page mobilization document.
To the best of my knowledge, Republican nominee Donald Trump has not commented on this initiative, but given his aversion to regulations, it’s probably safe to presume that it would not be a priority for his administration should he win the election.
The response to the White House campaign has been fairly predictable, with environmental groups and anti-plastics crusaders applauding the initiative while voicing some caveats. Comments from Plastics Campaign Director Christy Leavitt of Oceana, an international ocean-conservancy advocacy organization, are illustrative. “The US has been a laggard on national action to address plastic pollution,” Leavitt told the New York Times. But the Biden plan, at least, “puts the federal government in the driver’s seat to tackle its own plastic use.”
Final meeting on global plastics treaty.
The announcement from the White House comes just a few months before the fifth and final UN-led meeting to hash out a legally binding international agreement on reducing plastic pollution. That meeting will be held in Busan, South Korea, starting on Nov. 25 and will bring together government officials, experts, NGOs, and industry representatives. Previous meetings have been somewhat contentious, as maximalists argue that the best way to eliminate plastic pollution is to simply restrict plastic production, an approach that industry views as unreasonable and potentially devastating to the global economy.
You can read our coverage of past UN meetings by clicking on the links below:
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Possible second Trump term boosts urgency of treaty talks.
Politico reporter Jordan Holman had an interesting take on how the prospect of a second Trump term could be an accelerant in getting a global plastics treaty to the finish line. The “Trump bump” is boosting the “level of urgency around United Nations negotiations . . . to significantly cut plastic pollution,” writes Holman in the article published on April 9, 2024, just ahead of the fourth meeting in Ottawa. The rationale is that Trump as president would take a hard-nosed look at any treaty that emerged from the talks and would be “skeptical that the agreement reached was the best agreement that could have been reached,” Mario Loyola, a senior research fellow at the Heritage Foundation, told Holman.
The Politico article notes that treaty advocates feel the time is ripe to put pressure on the Biden administration and federal agencies to adopt their demands. The looming US election could have a positive impact on the discussions, Rep. Jared Huffman (D-Calif.) told Wolman. Headed for Canada to attend the meeting in Ottawa, Huffman said, “In the unthinkable scenario of a second Trump presidency, we’re going to get nowhere on plastics. That’s one reason to be motivated. A more positive and hopeful reason to be motivated is that this is a great opportunity for the Biden administration to show young voters that they get it.”
Remember, this was back in April. Kind of prescient, eh?
Paralympic Wheelchair Racing Demands Performance Gloves — 3D Printing Delivers
The 2024 Paris Olympics kicked off on July 24 with soccer and rugby matches and the official opening ceremony takes place tomorrow, July 26. Carbon-fiber composites are set to play a key performance-enhancing role in a multitude of sports from track and field, canoeing, and kayaking to archery and cycling. Come August 28, the Paris Paralympics are sure to showcase even more high-tech composites deployed in prosthetics, mobility devices, and more.
Take US athlete Tatyana McFadden, for example, who hopes to add to her incredible track record of eight gold, seven silver, and four bronze medals in various track events from the 100-meter competition to the marathon in the T54 wheelchair category for athletes with spinal cord injuries. McFadden has also emerged victorious in the New York City Marathon wheelchair category five times and even competed at the 2014 Sochi Winter Olympic Games in the women’s paralympic cross-country skiing event, winning the silver medal.
3D fit for purpose.
McFadden’s first racing gloves were made of heavy-duty fabric with rubber padding that allowed her to feel every impact against the wheelchair’s hand ring. By the 2008 Paralympic Games, she and her team began crafting hard gloves using plastic beads melted in boiling water, molded to fit her hands. Despite their thickness, these gloves were prone to wear and tear and didn't meet her high standards for competition.
A turning point came in 2015 when McFadden experimented with 3D-printed gloves. The following year, she partnered with 3D-printing firm CRP USA to further develop these gloves, focusing on enhancing strength and durability. "CRP USA has been incredibly supportive, not only with their innovative products but also in giving me confidence that my gloves will perform reliably," said McFadden.
CRP USA utilized selective laser sintering and Windform XT 2.0 composite material in the manufacturing process. The carbon fiber–filled composite employs a polyamide matrix.
Leveraging thermoplastics and SLS.
“Tatyana's previous gloves didn't meet her high standards,” stressed Nathan “Nate” Baker, senior project coordinator at CRP USA. “The Windform range of composites from our Italian partner, CRP Technology, proved to be a game-changer. After testing various Windform materials, Windform XT 2.0 emerged as the best fit.”
By leveraging selective laser sintering and Windform XT 2.0, CRP USA ensured the gloves met McFadden's demands for lightness, stiffness, wear resistance, and weather resilience. Detailed design improvements, such as hollowing out the gloves and adding internal structures, significantly reduced weight — the 3D-printed gloves weigh approximately 100 grams, half the weight of traditional gloves — while maintaining strength and integrity. These enhancements boosted her agility and speed. Rigorous tests confirmed their outstanding performance in terms of weight and durability.
McFadden will contest five individual T54 events — the 100 m, 400 m, 800 m, 1500 m, and marathon—at the 2024 Paralympics, showcasing her versatility in the wheelchair races. These Paralympic Games will be 35-year-old McFadden's seventh appearance (after 2004, 2008, 2012, 2014, 2016, 2020, 2024).
Talent Talk: A Manufacturing Boom Is Coming, but Where Are the Workers?
For the past year or so Talent Talk has been bullish on the manufacturing sector. Our reasons included the coming of industry 4.0, the hundreds of billions of dollars being invested into building a record number of new factories, and a significant reshoring effort.
Fed rate cuts coming.
I learned a long time ago from economists, investors, and other prognosticators that they are never wrong, just early in being right. So, I remain convinced that manufacturing is ready to shine. Talent Talk was an early adopter of this viewpoint, too early as it turns out. We underestimated the impact that higher interest rates for an extended period would present to a capital-sensitive industry, but the markets now are virtually certain that the Federal Reserve will begin a series of rate cuts in September.
Manufacturing construction spending at record high.
A recent joint study by the Manufacturing Institute and consulting firm Deloitte confirmed that the United States has been building new manufacturing facilities at an astounding pace, with the total number rising 11% in a roughly four-year period since early 2019. Moreover, manufacturing construction spending, which we called “eye-popping” last year, reached another record high this year and has tripled over the past four years.
The report went on to say that investment from both domestic and foreign manufacturers in — or in proximity of — the United States, commonly referred to as reshoring and near-shoring, continues to be a priority for companies in a desire to de-risk the supply chain.
A US manufacturing renaissance.
This coming growth in manufacturing will create 3.8 million jobs over the next decade, according to the study. Yet, it estimates that current workforce availability will allow only about half of those jobs to be filled, leaving 1.9 million unfilled.
It might seem like the hot labor market has cooled a bit — and it has — but that could prove to be a temporary phenomenon. Even in this market, 65% of manufacturers said that attracting and retaining talent is their primary business challenge, with a specific unmet demand for technical roles.
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➡️ Thermoforming Systems Supplier Illig to Lay Off Almost Half of Workforce as Part of Takeover: Cash infusion from Munich-based investment group comes with a price.
🗞 Big Brands Back Reusable Cups Trial in CA: A California city launches a reusable plastic cup program supported by 30+ restaurants and brands like Coca-Cola, PepsiCo, and Starbucks.
👏 Arburg Welcomes CT Governor Lamont to Black Forest: Lamont led a state delegation to the injection molding machine maker’s global headquarters in Germany.
🍦 Why Did This Ice Cream Brand Pick Plastic Pints Over Paperboard?: Blue Bunny’s preference for polypropylene containers points to a growing trend, according to packaging supplier Berry Global.
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