EUROPE, ASIA>>Surendra Kumar Borad, Gemini Corp.
Plastic Scrap prices were in an upward trend in the European market as well as in the Asian market from the second half of November until the beginning of December. Asian buyers were aggressive in buying during this period due to a high demand for reprocessed plastic in local Asian markets. Prices of prime material also increased during this period in both markets. Customers had negligible material in stock, due to less buying in last month, which further contributed to the price increases.
Around mid-December there was some indication in the prime materials market of price movement reversing and buyers started to reduce their purchases at what they viewed as high prices. Some of the producers of prime material reduced prices slightly to get the goods sold. This small reduction in prime prices created fear that prices would also fall in the plastics scrap market. Oil prices dropped from a high of $80 to $81 per Barrel to less than $70 per Barrel. These events caused the plastics scrap market to turn downward. Near the end of December prime prices got stronger again and the U.S. dollar strengthened against the Euro, which stabilized the plastic scrap market again.
Currently due to the year coming to an end, suppliers are trying to empty their warehouse before the Christmas holidays. Most of the companies will be closed from December 24 until the New Year. In China the New Year holidays fall in February, which will slow down shipments in the first week of January.
Shortage of containers is a major issue currently faced by exporters. Containers are currently not available with carriers whose freights are attractively priced. Exporters have been forced to pay higher freights with other carriers where space has been available. This situation seems set to continue until January 2010.
Surendra Borad can be contacted at email@example.com.