Guest Columnist

Mel Ettenson’s Global Plastics News

IAPD is pleased to welcome Mel Ettenson as a guest columnist each month in the IAPD News offering unique content for IAPD members.

The column below is only a sample of the Global Plastics News. If you are interested in learning more about the entire publication, visit www.globalplasticsletter.com.

THE GLOBAL ECONOMY:
Overall, economies are slowing, with revenues in our industry falling to single digit growth, year over year, the slowest pace in 18 months with third quarter growth expected to be 1.5-2.0 percent. Manufacturing is holding steady, with stubborn growth in almost every sector: automotive, metal fabrication, electrical equipment construction and appliances. A slowdown is still lurking due mostly to uncertainty in the Euro zone, but business spending will slowly increase despite some reluctance for banks to finance. Swings such as we have seen in the stock markets will also be prevalent in measuring economic growth. Get set for a dynamic, unpredictable late 2012- early 2013 business climate.

ENERGY:
Continuing shale exploration for natural gas combined with solar panels and oil below $100 per barrel are all energy moves worth watching for their impact on our industry. More oil from Libya, Angola and the United States and less demand based on global recessions are contributory. Expect continuing wild swings into 2013 in all markets, including financial, petroleum and polymers. This pre-supposes no disruption of supply caused by political unrest in the Middle East (fortunately Syria is not oil relevant). Growing supplies of natural gas auger good news for industrial users, especially those plastics processors that manufacture formaldehyde-based polymers such as acetal. Coming next year: credit card type transactions move to mobile devices, eliminating terminals and personnel. Tablet computers replace laptops as sales engineers telecommute and interact with customers in a more mobile environment.

PRICING:
Most resin and therefore shapes prices have drifted lower and once again were down last month. The outlook for the second half is for a continuation of this trend, with some selective exceptions, which will raise prices single digits in the fourth quarter of 2012, especially in PE, PP, PVC and nylon. Be watchful about ETPs, which will be market-driven rather than supply-demand or input-cost driven.

COMPANY NEWS:
Delmar Products begins its 50th year of supplying cellulose nitrate sheet to guitar pick maker D’Andrea USA. Bayer MaterialScience LLC (a major PC and PU producer) reports strong sales in the second quarter and raises its 12-month outlook to a 5 percent increase in revenue. Applied Industrial reports a slowing to single digit sales growth in the second quarter of 2012.

TRENDS:
As 2012 enters its closing quarters it is noteworthy that some of the oldest companies representing distribution and fabrication (TPs and thermosets) in our industry are at least 75 years young (Franklin Fiber Lamitex). We are researching the population and expect we may discover 90-100 year old companies and will be reporting on these. Our industry started with fabricators and most recently added this category to IAPD membership (the full circle again).

About Mel Ettenson
THE GLOBAL PLASTICS LETTER is a quick, highly informative plastics newsletter - to the point and timely enough to act on. In just four pages it packs relevant news, information and insights, with a primary focus on sheet, rod, tube and film, plastic semi finished shapes, plastic basic shapes, semi-finished plastics, plastic sheet rod tube and film. The newsletter covers pricing trends, market moves, new and upcoming products and services in the plastics industry.

E-mail: mettenson@globalplasticsletter.com
Website: www.globalplasticsletter.com

 

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