Resin prices threaten market recovery, says EuPC

Archiv – Europe | The Brussels-based European plastics converters organisation EuPC has attacked the hikes in plastics raw material prices announced by suppliers in recent weeks. ’Markets are currently too fragile to cope with this kind of increase,’ according to EuPC’s Managing Director Alexandre Dangis. Europe | The Brussels-based European plastics converters organisation EuPC has attacked the hikes in plastics raw material prices announced by suppliers in recent weeks. ’Markets are currently too fragile to cope with this kind of increase,’ according to EuPC’s Managing Director Alexandre Dangis.
’Converters are unable to pass these down the value chain onto their customers,’ he warns. ’Raw material producers are endangering the economic recovery of the plastics markets and are displaying a poor knowledge of business conditions at the sharp end experienced by their processor customers.’
Introducing EuPC’s latest economic report, Mr Dangis claims that investments in new plastics converting machinery have come to a virtual standstill, highlighting the difficulties faced by plastics processors all over Europe. Moreover, credit insurance schemes are not providing sufficient financial backing for companies to take on new risks and create growth. ’All of this,’ he says, ’is dampening the prospects for the expected re-launch of the economy.’
With variations from one country to another, the first half of 2009 saw a drop of 20% in European plastics converters’ production volumes when compared to the same period in 2008. Mr Dangis observes that the economic crisis has affected plastics converters less badly (down by 25% on the industry production index) than raw material and machinery producers which have experienced declines of, respectively, 32% and 69%. He adds that, surprisingly, production of plastics in primary forms has increased by 10% since early 2009 – a move which could herald a recovery for plastics converters.
Spain and Italy have been the most severely hit by the economic downturn, with production drops of around 26% and 27%, respectively. Conversely, Germany has shown the greatest resilience among EU-27 member states with an overall growth rate of 1.2%.
According to Mr Dangis, different parts of the plastics industry have been affected in different ways by the recession: on the one hand, the consumer packaging sector has been the least affected, with a manufacturing decrease of 15% since 2008; on the other hand, other plastics sectors have reported a decrease of up to 26% in the production of plastics goods when compared to last year.