TPE resin pricing, Feb. 21-25; PE mixed; PP’s slide stops; Mid East turmoil roils resin markets


Market overview: Spot resin markets remained busy into month-end, as supplies began to dry up and prices finished the week mostly higher. Spot-trading platform, The Plastics Exchange (TPE) noted that spot monomers also rose, influenced by soaring crude oil prices brought on by Mideast unrest. Processors have worked to avoid price increases in February, with PP finishing flat, but PE producers are still pushing for a $0.03/lb increase. Regardless of February's outcome, TPE believes PE producers will still go after an increase in March, while PP contracts see some sort of a decrease. Spot export markets were a little more active, with better demand seen from Latin America and Europe.

Energy markets: Prices rallied in highly volatile trading, with April crude oil futures reaching $103/bbl, before settling back down to $97.88/bbl. For the week, the price was still up $8.17/bbl. April natural gas futures recovered some recent losses, rising $0.099/mmBtu to close at $4.005/mmBtu on Friday. The crude oil : natural gas price ratio shot to an all-time record, expanding out to 24.4:1. Since about 70% of North American ethylene is derived from natural gas, integrated PE producers have a huge cost advantage compared to most of their international counterparts that derive their ethylene from crude oil. TPE notes that the relationship is even more pronounced in Europe, where Brent North Sea Crude settled the week at $112.14/bbl....
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