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Market Report

Oil prices are being pulled in a variety of directions and the volatility in the marketplace seems to depend on what news gets placed above the fold. What we can see from the year-to-date monthly pricing is that oil prices have been flattening into the fall season.

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OPEC worries that prompted calls to limit production and raise prices seem to have cooled off with the weather. Virgin resin feedstock prices are generally more in line with natural gas prices and it seems that Henry Hub spot prices have risen considerably with the onset of the summer months.

The recent industrial production report numbers for September shows a slight rebound from August with manufacturing up 0.2%, driven by a 0.5% increase in the production of non-durables. This news from the Federal Reserve seems to complement Moore Recycling’s analysis that commercial film collection has improving export opportunity potential.

International outlook:

The Hong Kong and Shanghai indices diverged over the summer months but seem to have settled into a new normal. This may account for a bit of the changes that are seen below in the volumes of plastic scrap exports to China as adaptations to environmental regulations continue to develop.

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Over the last year, the Mercosur index has been steadily increasing. This includes the markets for Argentina, Brazil, Paraguay, and Uruguay. Although the data is inconsistent for scrap exports going to those economies, Latin America may be an opportunity to find relative market safety when larger global partners are cutting back on their consumption. Mexico, being one of the more developed Latin American economies, will track more closely with market fluctuations but other Latin American countries have a steady consumption patterns that can provide valuable partnerships against price volatility.

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Plastics Beat

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