Today’s plastic resin markets are in turmoil with extreme price increases and scarce product availability.
The resin market is just one of many that have had supply chain issues as many other markets have experienced. The wild ride started to get even hairier in May of 2021. “Supply shortages intensified, prices rose, and processors flocked to the spot market, scooping up every reasonable offer. After those were gone, they proceeded to grab the unreasonably priced offers, too,” per team managers at “Plastics Today” – an online community for plastics industry professionals.
In an article earlier in 2021, Plastics Today noted key reasons for the issues:
“Resin production meets a perfect storm: It has been two weeks since a massive winter storm struck the Houston area, knocking out power and shutting down the entire petrochemical-producing region, including some 80 to 85% of US PE and PP production. Resin supplies were already reeling from a series of other disruptions that have plagued the industry for the past six months, notes the PlasticsExchange, so the market was in no condition for another wallop.”
Plastic Resources, Inc., has been working through these issues with our customers, and we suggest the following key points to navigate the situation:
- Avoid having only one resin approved for your part when possible.
- Communicate with your molder to provide up to date forecasts so they can work with the resin suppliers and discuss stocking of material.
- Talk often to your molder and understand their current lead times and resin availability.
- Place orders as far ahead as possible.
These are the type of discussions Plastics Resources, Inc. has with our customers every day. Need guidance from a team of experts? Reach out to see how we can help you.
Plastic Resources, Inc.