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  Past Reports
Weekly Market Update
Market Update
June 16, 2017


The spot resin markets were noticeably slower and prices were mildly mixed. In general, there were fewer Polyethylene inquiries which were equally matched by sometimes sporadic supplier offers, together challenging the spot trade where completed transactions fell below average. Prime PE prices were mostly steady with both domestic offgrade and export resin seen softer. Polypropylene levels inched up another half-cent amid tightening supplies and firming monomer costs. Incremental PE and PP exports, even to Latin America, have been hampered by competitive offers from other regions and the psychological impact of Crude Oil on the low end of its price band. It is however, prudent to mention that the official hurricane season is now underway and geopolitical tensions remain elevated.

The major energy markets all moved moderately lower. July WTI Crude Oil futures slid $1.09/bbl to settle Friday at $44.72/bbl, a new low for this market cycle. August Brent Oil futures peeled off $.78/bbl to end the week at $48.15/bbl. July Natural Gas futures traded in a $.17/mmBtu range, but went into the weekend nearly flat at $3.037/mmBtu. Prompt NGL prices saw minimal change - June Ethane edged fractionally higher to $.25/gal ($.105/lb); Propane lost just a quarter-cent to $.5925/gal ($.168/lb).

Spot Ethylene trading activity continued to rev up though prices remained pressured. A higher volume of material was sold pressing prompt prices down about a penny to $.235/lb, a level not seen since the end of Nov. Spot Propylene trading improved and prices continued to slowly climb; the few confirmed transactions were seen lifting the PGP market about a half-cent to almost $.38/lb. June PGP contracts settled at $.385/lb, which was a roll-over from May, though a penny increase could have easily been justified.

Polyethylene trading lacked the bright luster of recent weeks; market sentiment has turned a tad more negative and buyers seem to have shied away from excessive purchases. There was ample supply of most commodity grades, with the continued exception of HDPE for injection, which remains scarce. Railcar offerings for un-certed / liberally downgraded PE resin were shown at discounted levels, while offers for true Generic Prime resin were limited, perhaps held-back as June contract negotiations have been heating up.

Time continues to march swiftly, bringing the market ever closer to another round of fresh Polyethylene production from new and/or expanded facilities. PE buyers seem to be quite comfortable and are looking to gain additional contract price relief, building on the $.03/lb decrease achieved in May; producers, of course, are looking to stop the slide and hold June contracts steady.

Polypropylene trading was a bit better and buyers were willing to pay up a little for spot material amid slightly bullish conditions. The spot PP market has already added a couple cents and we see the potential for additional small gains ahead. While most commodity PP Homopolymer grades were readily available, good quality PP Copolymer supplies have thinned significantly, especially No Break resin and Random Clarified, where premiums have been expanding.

Polypropylene contracts will mostly follow Propylene monomer flat in June and while we have recently seen some spot strength, it does not appear enough to warrant an attempt at de-coupling the tight correlation to monomer. June contracts could have been $.01/lb or so higher, instead there appears room reserved for an uptick in July. Resellers with uncommitted resin on hand have been quietly raising prices and even adding to surplus positions if sharp offers are presented.

Total Offers 13,810,388 lbs Spot Contract
ResinTotal lbsLowHighBidOffer
PP Homo2,658,852$.470$.560$.485$.525
HDPE - Blow Mold2,441,392$.480$.540$.470$.510
HMWPE - Film2,174,140$.510$.560$.485$.525
LLDPE - Film1,835,036$.515$.580$.500$.540
LDPE - Film1,455,036$.570$.640$.570$.610
PP Copo896,552$.500$.620$.515$.555
HDPE - Inj890,184$.620$.680$.590$.630
LLDPE - Inj770,552$.560$.630$.540$.580
LDPE - Inj688,644$.560$.635$.550$.590
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