Prime virgin prices are from China’s major virgin polymer websites in Renminbi RMB. The exchange rate is 1 US dollar= Chinese Yen at 6.6899.
Crude oil prices closed at $107.62 on Friday in New York, settled higher than the Asia section but declined from recent weeks on recession fears.
Most prime prices in China have been trending downward as the country continues to practice the Covid zero strategy. Operation of shops and factories, movement of residents, transportation of goods, and supply chains are badly disrupted. The government would lock down a whole city of millions of people wherever there is a Covid case. There is no timeline for the country’s reopening for visitors and residents to return to China without quarantine. The Beijing government is putting all the effort into containing and mitigating the spread of the Virus. Social and economic activities have been at the lowest level since the beginning of the Covid.
Additionally, June, July, and August are the months of low season for the demand for plastic materials. Apart from PS, PET and PMMA are relatively stable; all other prime are sliding in prices. The worst performed are Polycarbonate, PA66, and ABS, with price adjustments over $ 100 per ton.
For secondary materials, PE, PP, PMMA, and Styrenic recycled materials remain stable as there are limited supplies of imported recycled pellets due to scarce resources of plastic scraps from Europe and the US. However, recycled POM, Polycarbonate, and Nylon have sunk by more than $ 300-400 per ton following the downward adjustments of their prices and manufacturing slowdown. Market players do not expect any turnaround before September; some traders anticipate the market could only improve if the government relaxes Covid restrictions, hopefully by the of the year.
Scrap plastic supplies have further reduced amid price disconnect between exporting countries of North America & Europe, and Asia. Additionally, almost no shipping line would accept plastic waste shipment under the HS code of 3915. The only recovered materials that can export would be clean, separated, and processed materials with contamination within the threshold. These materials are scraps from primary sources like petrochemical industries and manufacturing offcuts and reject. The Australian government last year announced a ban on all plastic wastes exported from 1 st July 2022. The latest initiative from Australia would undoubtedly impact supplies of baled materials of bottles and PE film. With all the regulatory restrictions for the transboundary movement of plastic wastes, plastic recycling would eventually become a localized industry in the country of waste generated.