Your Business Pricing Update - April 2007

Polyolefins, PET, and PVC were on the way up last month, as resin suppliers sought to recover margins shrunken by lackluster demand and higher feedstock costs. A strong export market over the last few months and expectation of a lift from second-quarter seasonal demand has lifted resin plant operating rates after a slump in the fourth quarter.

 

PE prices up a little

Polyethylene moved up 3¢/lb in February, implementing half of the price hike originally slated for Jan. 1. By mid-March, it did not appear that the second half of the increase (for LL/LDPE only) was taking hold. A second increase of 7¢, announced for mid-January, was pushed back to Apr. 1. The London Metal Exchange (LME) short-term futures contract for April in g-p butene LLDPE for blown film sold at 52.2¢/lb, up from March’s 51¢.

Contributing factors: With two price initiatives pending, resin suppliers hope to recover at least part of the fourth quarter’s 17¢ erosion in profit margins. Suppliers’ inventories are low due to reduced operating rates in the fourth quarter and strong exports, offsetting slow domestic demand from November through February.

Ethylene monomer contract prices for February and March did not go up as expected. In fact, February contracts settled down 1¢ to 38.9¢/lb, and March contracts held even.

 

PP inches up, too

Polypropylene prices moved up in January and February a total of 5¢/lb. Suppliers posted a 4¢ increase for March 1, but industry sources indicated that no more than 2¢ of that is likely to be implemented. LME’s April short-term futures contract for g-p injection-grade homopolymer sold at 52.2¢/lb, the same as in March.

Contributing factors: So far this year, PP prices have closely tracked monomer prices. Propylene contract prices for February rose 2¢/lb, followed by settlement of March contracts at the February level. However, some industry sources project that monomer prices will start rising, owing to some planned cracker turnarounds, good exports, and the start of the driving season.

In the short term, PP resin prices are expected to be mostly flat. Scott Newell, managing partner at purchasing consultant Resin Technology, Inc. (RTI), Fort Worth, Texas, says resin makers lack pricing power to improve their margins because domestic demand has been weak. “While I would not say you can expect prices to go down, they are also not likely to go up for now,” Newell concludes. PP producers say inventories are low across the supply chain and the usual seasonal uptick in demand could change the picture.

 

PET prices moving up

PET prices were slated to rise 5¢/lb last month, and suppliers tacked on another 4¢/lb increase for Apr. 1.

Contributing factors: PET producers are aiming for margin recovery, having lost most of their 12¢ to 15¢ gains of the last half of 2006. They also expect price pressure from feedstocks, especially paraxylene, as the approaching driving season boosts demand for gasoline at refineries.

The supply/demand balance is said to be on the tight side, with demand up about 6% and operating rates in the low 90s. But the situation is expected to reverse by the end of the second quarter as major new resin capacity comes on stream after start-up delays at the new PET plants.

 

PVC announces second hike

In mid-March, PVC producers were trying hard to get 2¢ of a 3¢/lb increase announced for March 1. They also all announced another 3¢ increase for Apr. 1. Three-cent hikes are highly unusual for PVC, which typically goes up or down in 2¢ increments. This is considered an attempt to stem the slide that began in the very weak fourth quarter and continued in January and February, when prices slipped 3¢.

Contributing factors: Resin producers’ operating rates in February were 86%, up a little from January but generally not considered enough to support a price increase. In-ground pipe demand is strong, but other sectors like siding, windows, and electrical conduit are still very weak.

 

PS is quiet, ABS up

Resin producers say they encountered no resistance to the 4¢ hike in March, which was prompted by higher benzene prices. There were no further pricing moves as of mid-March.

On the other hand, Dow raised prices by 10¢/lb on Apr. 1 for two styrene copolymers—ABS and SAN.

 

Epoxy & isocyanates rise

Dow Epoxy added 6¢ to 10¢/lb to prices of epoxies and curing agents on Apr. 1.

Also on that date, Dow Polyurethanes lifted tabs on TDI by 10¢ and MDI by 5¢/lb. 

 

Market Prices Effective Mid-March A

RESIN GRADEb ¢/LB ¢/CU INc    ABS           MED IMPACT    84 - 90      3.1 - 3.4       HI IMPACT    89 - 125      3.3 - 4.7       X-HI IMPACT    99 - 140      3.7 - 5.3       HI HEAT    89 - 110      3.3 - 3.8       PIPE    89 - 100      3.7 - 3.8       SHEET    94 - 110      3.5 - 4.2       TRANSPARENT    129 - 200      5.6 - 8.8       FITTINGS    89 - 110      3.5 - 4.3       PLATING    100 - 130      3.9 - 5.1       FLAME RET    124 - 140      4.6 - 5.9       STRUCT FM    87 - 97      3.2 - 4.3       10% GLASS    129 - 140      4.8 - 5.6       30% GLASS    124 - 136      4.6 - 6.3       ABS/PC ALLOY    149 - 180      5.5 - 6.8       ABS/PVC ALLOY    134 - 139      5.0 - 5.2       ABS/NYLON ALLOY    194 - 350      9.0 - 16       ACETAL           HOMOPOL    151 - 172      7.7 - 8.7       20% GLASS    171 - 235      8.7 - 11.9       COPOLYMER    144 - 160      7.3 - 8.1       25% GLASS    171 - 245      8.7 - 12.4       ACRYLIC           G-P    117      5.0       IMPACT    192      8.2       ACRYLONITRILE COPOL           EXTRUSION    101 - 116      4.0 - 4.6       INJECTION    120 - 135      4.8 - 5.4       ALKYD  65 - 74    4.9 - 5.5       CELLULOSICS           ACETATE    187      8.6       CAB    189      8.2       CAP    189      8.2       DAP (G-P)  251 - 497    16.7 - 34.7       EPOXY           G-P RESIN    116 - 126      NAd       COMPOUNDS               C/B/Te    123 - 166      9.4 - 12.9       R/C/Df    208 - 271      15.3 - 20.1       SEMICONDUCTOR               NOVOLAC    193 - 228      13.1 - 15.9       ANHYDRIDE    188 - 268      13.9 - 19.2       EVA           INJECTION    46 - 52      1.5 - 1.7       FILM EXTRU    42 - 49      1.4 - 1.6       EVOH  315    13.4       FLUORO-POLYMER           CTFE    5000 - 6000     385 - 462       ECTFE    1470 - 1680     93.1 - 107.7      ETFE    1155 - 1680     70.7 - 102.8      FEP    971 - 1470      74.8 - 113.2      PFA    1785 - 2520     134.9 - 190.5       PTFE    450 - 900      34.8 - 69.7       PVDF    680 - 900      43.3 - 57.3       IONOMER           PACKAGING    127 - 166      4.3 - 6.0       INDUSTRIAL    150 - 244      5.0 - 8.3       LIQUID-CRYSTAL POLYMERS           INJECTION MIN FILLED    690 - 1035      44.2 - 72.1       GLASS FILLED    695 - 895      40 - 52       CARBON FILLED    1700 - 2000     83.2 - 138.6      UNFILLED    1000 - 1200     58 - 70       EXTRUSION UNFILLED    1200 - 2200     60.5 - 110.9      MELAMINE COMPOUND  90 - 94    5.5 - 5.6       MELAMINE/PHENOLIC COMPOUND  75 - 83    4.5 - 5.0       NYLON           TYPE 6    139 - 159      5.7 - 6.5       MIN FILLED    131 - 144      5.4 - 5.9       30% GLASS    148 - 173      6.0 - 7.0       TYPE 66    153 - 168      6.3 - 6.9       MIN FILLED    151 - 159      6.2 - 6.5       30% GLASS    142 - 192      5.8 - 7.9       TYPE 69    250 - 276      9.7 - 10.7       TYPE 6/10    286 - 313      12.4 - 13.6       TYPE 612    400      15.3       30% GLASS    309 - 311      14.7       40% GLASS    309      14.7       TYPE 46    295      12.6       TYPE 11    329 - 341      13.6 - 14.1       30% GLASS    331 - 350      15.0 - 15.8       40% GLASS    347 - 360      17.7 - 18.5       TYPE 12    318 - 341      12.1 - 13.0       30% GLASS    327 - 350      14.7 - 15.8       50% GLASS    299 - 340      15.6 - 17.8       TRANSPARENT AMORPHOUS    247 - 360      10.3 - 15.0       PHENOLIC MOLD COMP  75    3.8       REINFORCED GRADES    105 - 268      6.1 - 16       POLYAMIDE-IMIDEg           UNFILLED    2750      148.5       30% GLASS    2500      135       30% CARBON FIB.    3500      185       POLYARYLATE  200 - 280    8.8 - 12.3       POLYARYL SULFONE  440    21.8       POLYBUTYLENE           G-P    94 - 96      3.1       FILM    88 - 91      2.9       PIPE               COLD WATER    116 - 120      3.9 - 4.0       HOT WATER    162 - 166      5.5 - 5.6       POLYCARBONATE           INJECTION    138 - 165      5.9 - 7.0       20% GLASS    177 - 190      7.6 - 8.2       30% GLASS    178 - 217      7.6 - 9.3       EXTRUSION    145 - 180      6.3 - 7.8       BLOW MOLD    155 - 190      6.7 - 8.2       STRUCT FOAM    149 - 181      6.4 - 7.8       20% GLASS    235 - 255      10.1 - 11.0       FR    166 - 197      7.1 - 8.5       CD    140 - 200      6.0 - 8.6       POLYESTER (TP) PBT TYPE           UNFILLED    145 - 150      6.8 - 7.0       HI-IMP    160 - 165      8.4 - 8.6       30% GLASS, FR    190 - 210      11.2 - 12.5       STRUCT FOAM    159 - 165      NAd       PET           BOTTLE (RAILCAR)    76 - 78      3.9       MOD PET               30% GLASS    132 - 143      7.4       55% GLASS    148 - 155      9.8       30% GLASS FLAME RET    147 - 157      9.2       PETG COPOL    114 - 124      5.2 - 5.6

RESIN GRADEb ¢/LB ¢/CU INc    POLYESTER THERMOSET           G-P ORTHO    140 - 145      NAd       ISOPHTHALIC    165 - 175      NAd       BIS-A    210 - 215      NAd       PEEK  4400    231       30% GLASS    3300      173       POLYETHERIMIDE  641 - 646    29.3 - 29.5       30% GLASS    526 - 531      24.0 - 24.2       POLYETHERKETONE (PEK)  2950    130.1       30% GLASS    2600      153       POLYETHERSULFONE  350 - 400    17.2 - 19.7       30% GLASS    425 - 525      21 - 25.9       POLYETHYLENE (RAILCAR) LDPE           G-P MOLDING & EXTRU    79 - 82      2.6 - 2.7       INJECTION    82 - 84      2.7       LID RESIN    84 - 86      2.7 - 2.8       LINER    78 - 80      2.6       CLARITY    76 - 78      2.5 - 2.6       EXTRU COATG    83 - 85      2.7       BLOW MOLD    85 - 87      2.8       LLDPE, BUTENE BASED           G-P MOLDING    65 - 67      2.2 - 2.3       LME 30-DAYj    52      1.8       FILM    67 - 69      2.3 - 2.4       ROTOMOLD    69 - 71      2.3 - 2.4       LLDPE, HAO-BASED           G-P MOLDING    70 - 72      2.4       LID RESIN    81 - 83      2.7       LINER FILM    74 - 76      2.5 - 2.6       HDPE           G-P INJ MOLD    67 - 69      2.4       FILM    76 - 78      2.6       BLOW MOLD    70 - 72      2.4 - 2.5       HMW-HDPE           BLOW MOLDING    74 - 76      2.5 - 2.6       FILM    76 - 78      2.6       PIPE    82 - 84      2.7 - 2.8       UHMW-PE  1.00 - 1.25    3.6 - 3.7       PPE/PPO BASED RESIN           INJECTION    180      6.8       20% GLASSh    283      12.3       30% GLASSh    291      13.3       EXTRUSIONh    242      9.2       STRUCT FM    231      NAd       PPS           40% GLASS    357 - 404      21.2 - 24.0       55% GLASS/MINERAL    289 - 310      20.8 - 22.3       65% GLASS/MINERAL    226 - 273      15.5 - 18.7       POLYPROPYLENE (RAILCAR)           G-P HOMOPOL INJECTION    79 - 81      2.6       LME 30-DAYj    52.2      1.7       EXTRUSION FIBER    77 - 79      2.5 - 2.6       PROFILES    83 - 85      2.7       RANDOM COPOL               BLOW MOLDING    81 - 83      2.6 - 2.7       FILM    82 - 84      2.6       INJECTION    84 - 86      2.6       IMPACT COPOL               MED IMP    92 - 94      3.1       HI IMP    95 - 97      3.2       POLYSTYRENE (RAILCAR)           G-P CRYSTAL    79 - 85      3.0 - 3.3       HI HEAT    82 - 88      3.1 - 3.3       HIPS    80 - 85      3.0 - 3.3       SUPER HI IMP    90 - 94      3.2 - 3.5       FR    98 - 106      3.7 - 4.0       STRUCT FM (FR)    105 - 108      NA       EPS           UNMODIFIED    85 - 88      NAd       MODIFIED    86 - 90      NAd       POLYSULFONE  569 - 622    25 - 28       10% GLASS 430 20.6    749 - 799      36 - 39       30% GLASS 372 20.01    659 - 699      32 - 34       POLYURETHANE (TP)           ESTER TYPE    185 - 255      8 - 11       ETHER TYPE    245 - 295      10.6 - 13       PU ISOCYANATES           POLYMERIC MDI    118 - 135      NAd       80/20 TDI    145 - 155      NAd       PVC RESIN (RAILCAR)           G-P HOMOPOL    47 - 49      NAd       PIPE    46      NAd       FILM    55 - 58      NAd       COPOLYMER FLOORING    68 - 70      NAd       DISPERSION HOMOPOLY    81 - 87      NAd       COPOLYMER    86 - 90      NAd       CPVC PIPE COMPOUND    119      NAd       PVDC           EXTRUDABLE    162      NAd       SILICONES           MOLD. COMP.    581 - 640      38.1 - 39.3       SPECIALTY GR.    891 - 3148     NAd       SILICONE/EPOXY    339 - 343      22.5 - 22.8       STYRENEACRYLIC  108 - 112    3.7 - 4.0       SAN (G-P)  66 - 74    2.5 - 2.8       STYRENE MALEIC ANHYDRIDE           G-P    110 - 115      4.2 - 4.3       HI IMP    130 - 140      4.2 - 4.5       FR    175 - 183      6.7 - 7.0       TP ELASTOMERS           OLEFINIC    70 - 76      2.4       POLYAMIDE    300 - 350      10.9 - 12.7       POLYESTER    200 - 310      8.8 - 13.6       STYRENIC    82 - 237      2.9 - 8.3       UREA MOLDING COMPOUND           BLACK & BROWN    76      3.8       WHITE & IVORY    81      4.0       VINYL ESTER           COR RES    218 - 230      NAd       HEAT & COR RES    243      NAd

KEY: Colored areas indicate pricing activity. An arrow () indicates direction of price change. aTruckload, unless otherwise specified. bUnfilled, natural color, unless otherwise specified. cBased on typical or average density. dNot applicable. eNovolac and anhydride grades for coils, bushings, transformers. fNovolac and anhydride grades for resisitors, capacitors, diodes. gIn quantities of 20,000 lb. h19,800-lb load. jLME 30-day futures contract for lots of 54,564 lb..