Predictions for plastic injection molding resin for the coming year are typically made by studying the market trends for industries that make significant use of nylon, polystyrene, polycarbonate, ABS, polypropylene and polyethylene, respectively.
In a recent article by Frank Esposito published in the Plastics News on November 18, 2013, market experts weighted in on their industry predictions for 2014.
Predictions for Nylon
The improved automotive market is helping drive the increase in demand for both nylon 6 and 6/6 resins. According to HIS Inc. nylon market analyst Paul Blanchard, in a talk delivered at the Global Plastics Summit held Nov 4-6 in Chicago, demand for nylon 6 will increase by about 3.5 percent from 2013 through 2018 globally. Pricing, however may continue on the down-slide since 2011 and may be flat, to slightly down in 2014.
The higher prices for benzene feedstock were spurred in part by the industry’s switch to lighter natural gas-based feed-stocks. This is expected to put pressure on nylon and other resins for the coming years ahead, according to Blanchard. He also reported that Benzene prices “aren’t expected to come down dramatically.”
Nylon 6/6 pricing is on pace to be flat to slightly down in 2014 due to the demand for that material. It is expected to be 3.6 percent from 2013-2018, Blanchard stated.
There has been some recent competition between nylon 6 and 6/6 in some applications. Polypropylene is also competing with both nylons. PP markers “see some real opportunities where nylon is over specified,” Blanchard said.
Predictions for 2014 Polystyrene (PS) Prices
The well-documented struggles of the PS market are expected to continue, according to HIS Inc. PS market analyst Priya Ravindranath. High benzene prices have made PS less competitive than the other resins, while environmental challenges have led the material to be banned in some areas.
There’s been a significant PS price increase in the last decade, as well as a steady decline in demand, according to Ravindranath. The high prices and low benzene supplies in North America will lead to benzene imports causing increases of 30 percent in North America by 2018. This is expected to make prices much more sensitive to supply-disruption for injection molding.
Global benzene prices are expected to remain in the $4-$5 per gallon range in the near future, price levels that are high by historical standards. Looking ahead, Ravindranth said the global PS demand should improve to 2 percent per year from 2013-18. Global PS operating rates are set to be between 65-70 percent with North America PS operating rates higher at 75-80 percent.
Predictions for Polycarbonate (PC) Demand
Asia accounts for almost 60 percent of global PC demand. IHS PC/ABS market analyst David Gee reported that the global PC demand is adding almost 2 billion pounds of new capacity through 2017.
That’s more than what’s needed to handle global PC demand growth. In North America, new global capacity has made it difficult for PC makers to raise prices. Prices in North America are expected to be roughly flat in 2014, Gee added. This is due to more Asian import material coming in, and fewer PC exports going to China.
ABS Market Demand
In the global ABS market, Gee also stated that low single digit demand growth is expected to effect injection molding in 2014. North American ABS prices should decline slightly, as more foreign material with lower raw material costs becomes available.
Polyethylene (PE) Demand Grows for Injection Molding
Plastics News published another article by Frank Esposito on September 26, 2013, titled; Polyethylene Prices Jump up 5 Cents.
According to this article, prices tightened up in September of 2013 due to a smaller inventory and a slightly stronger demand. PE makers have been enjoying high profit margins largely as a result of the low-priced feed-stocks.
Abundant and expanding supplies of natural gas are being used to provide ethane, which is then converted into ethylene and polymerized into PE. North America’s feedstock advantage also prompted several PE makers to announce plans to add capacity. For the year, regional HDPE prices are now up a net of 16 cents per pound - while regional prices for LDPE and linear LDPE have climbed a net of 14 cents.
Polypropylene Prices are also Up
In an article by Jerry Powell published in Resource Recycling on October 10, 2013, PE, PP and PVC resin markets are to remain volatile. Michael Greenburg of the Plastics Exchange said the cost of North American PP is too high to attract offshore interest.
The extreme volatility led to changes in amounts of PP held in inventory by plastic processors. New PP production capacity is coming on-line but will not result in price weakening in 2014.
These pricing trends for raw materials are important for a custom injection molder like Crescent Industries, which manufactures plastic components using all of these resin raw materials. For more information on Crescent Industries services and capabilities, please click here.