Polymer Prices And Pulse And Plastic Free Aisles

Posted on 26 Sep 2017

Polymer Prices And Pulse And Plastic Free Aisles

The Autumn equinox has (as usual) triggered further price increases from the European polymer suppliers.  A further 50 Euro cents per tonne for October deliveries has been added to the September price increases previously noted.  Whilst the relatively low level of sterling throughout the early weeks of September is one of the reasons being given for this increase, the closure of plants in the Southern States of the US for safety reasons during the hurricane season, is claimed to have added to the problem due to US polymer imports.

Whatever the reasons, the forecast is that price increases of polymer will continue in the final quarter of the year, due to planned “outages” for maintenance of several polymer plants.  The cynics amongst us may ask why these “outages” are not planned for the summer months when demand for polymer declines across Europe.  Why do these companies wait until the peak season for demand before closing capacity?  I am sure we can all guess the answer.

Whatever the reason, the consequence is that the film price increases that we mentioned last month will continue and our advice to all our customers is, wherever possible buy forward for stock, even at today’s prices, as we are likely to see the supply situation exacerbate over the coming months.  Whilst these increases apply to all OPP, PE and standard co-ex films, interestingly there is a shortage of engineering quality.  Unlike packaging polymer this is a much rarer event which could lead to capacity switching to higher value polymers.

Pulse Flexibles:-  The Final Chapter

Last week saw the auction of all the Pulse Flexibles plant and machinery.  A sad day indeed for those of us that care about the converter market.  Rumour has it that right up to the late hours of Monday, a Turkish convertor was trying to buy the assets and re-open at least the Bury site, however a substantial offer for the land and buildings from a local company persuaded KPMG to proceed with the auction.

It will take some months to clear out all the plant and get it fully operational in its new home (we hear some has gone as far afield as Russia).  Meanwhile the supply problems of printed film and laminates across the UK continues.

As previously noted lead times are up to 6-8 weeks from some printers and one major convertor in the North is refusing to take orders from some customers until after the Christmas period.  Hopefully those customers affected will contact National Flexible which, (due to our unique business model) have no capacity constraints.

Before leaving the Pulse scenario completely, we noted the Amcor closure of their Moreuil plant in France.  They originally announced this rationalisation of their European capacity in June, along with redundancies at the UK Cumbria plant. Presumably the redundancies have been shelved as Amcor are one of the major beneficiaries of the Pulse Flexibles closure and (we hear) one of the companies where delivery dates have been extended due to the influx of Pulse customers.

Plastic Free Aisles

I will re-visit this subject next month, but first of all thank you to those people who sent me their views on the “Demonisation of Plastic”.

Suffice to say last Friday’s Telegraph featured a letter suggesting the return of more aluminium cans for packaging pet foods (ALU is the most environmentally damaging material on the planet for packaging).  Plus another letter suggesting “The Planet is being destroyed under a mountain of plastic” – “no hyperbole here then”.  My response in a letter to the editor was, of course, ignored.

Finally, Thursdays Times featured a large photo of a female scuba diver in the sea at Bali surrounded by allegedly 3 tonnes of plastic rubbish (who weighs this stuff?)

Is it me or are we on a slippery slope leading to restricting plastic packaging?

Any views you may have on any of the subjects raised would be welcome.

Any thoughts you may have on any of these items raised would be welcome and why not join me on LinkedIn for regular updates.