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MARKET UPDATE

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The spot resin markets were somewhat slow the first week of September. The flow of railcar offers was
lighter; however, most commodity grade resins remain readily available in packages in Houston and
around the country. Polyethylene prices held steady and Polypropylene prices firmed a penny, recording a
rare weekly gain amid a longer term bear market. Several Polyethylene producers offered to reduce September contracts by $.04/lb. Polypropylene producers are again seeking to raise resin prices relative to
monomer costs. Spot resin exports continue to challenge; while suppliers have aggressively lowered PE
prices to remain competitive on the world market, economic worries, particularly in Asia, have kept traders
cautious. While Mexico remains a natural destination for surplus US resin, the weak Peso is starting to
have a noticeable impact on demand.

Market Update September 4th, 2015

Total Offers 14,075,344 lbs

Resin

Total lbs

Spot
Low

High

Bid

Offer

HDPE - Inj

3,232,348

$ 0.540

$ 0.610

$ 0.530

$ 0.570

LDPE - Film

2,589,864

$ 0.510

$ 0.640

$ 0.550

$ 0.590

HDPE - Blow Mold

2,024,048

$ 0.530

$ 0.585

$ 0.520

$ 0.560

LLDPE - Film

1,923,220

$ 0.540

$ 0.600

$ 0.520

$ 0.560

PP Copo - Inj

1,289,104

$ 0.590

$ 0.700

$ 0.590

$ 0.630

895,472

$ 0.575

$ 0.610

$ 0.540

$ 0.580

790,460

$ 0.570

$ 0.650

$ 0.570

$ 0.610

732,736

$ 0.490

$ 0.620

$ 0.560

$ 0.600

598,092

$ 0.500

$ 0.655

$ 0.580

$ 0.620

HMWPE - Film

The major energy markets were mixed and after a very volatile start to the week, eventually calmed. October WTI Crude futures jumped almost $4/bbl on Monday and gave back most on Tuesday, before trailing PP Homo - Inj
off the rest of the week. The market closed Friday at $46.05/bbl, for a net gain of $.83/bbl. Oct Brent Oil LLDPE - Inj
also saw a 13% trading range and ultimately settled Friday at $49.61/bbl, having shed a net $.44/bbl.
LDPE - Inj
Natural Gas trading was more subdued, the October futures contract went into the weekend at $2.655/
mmBtu, having lost $.06/mmBtu. Spot Ethane was again about unchanged at $.1875/gal ($.079/lb); Propane recovered further, jumping more than $.03/gal to $.44/gal ($.125/lb).
Spot Ethylene was moderately busy and prices declined; material for September delivery peeled off a
couple cents, the losses came early in the week. Prompt Ethylene most recently changed hands at $.23/
lb, just above the seasons lows. Despite significantly reduced margins, several petrochemical firms made
positive announcements concerning their future development plans. Ethylenes forward curve has maintained its slight contango shape, prices are currently indicated to rise to nearly $.25/lb by March 2016.

HDPE Blow Molding

1 Year

The spot Polyethylene market was only lightly traded, generating a below average volume of transacted
material. While offers were not always vocalized, there seems to be plenty of material available at a fair
market price. Producers were very quick to announce their intention to lower contract prices for September, which should stimulate orders. While not all producers have yet nominated the $.04/lb decrease,
most/all will likely follow. Producers were proactive in August as well, dropping a quick $.03/lb, but it was
not enough and the decrease eventually became $.05/lb. If the current $.04/lb drop holds as is, contracts
will be down net $.13/lb for 2015, $.20/lb in the last 10 months.
The physical Propylene market saw mostly bids and offers, while financially settled PGP recorded the bulk
of transactional volume. Market prices were mostly steady throughout the week, with prompt PGP still in
the vicinity of $.26/lb. The forward curve continues in contango, with a $.025/lb premium peaking in June
2016. August PGP contracts were priced at $.33/lb, which was down $.035/lb. Based on current spot values, another decrease of $.035 -.04/lb could be justified for September. RGP eased a half cent to $.15/lb.

PP Homopolymer
1 Year

Spot Polypropylene trades were few and far in-between and prices edged a penny higher this past week.
Surplus material is generally hard to come by, and when available, it has usually been offgrade. Contract
pricing remains below spot and with inadequate supplies still persisting, even contract buyers are willing to
pay up as needed. Producers appeared adamant about enforcing the entire $.05/lb increase (beyond the
change in monomer) nominated for August PP, but when the dust settled, it seemed that only about a
$.02/lb margin increase held. So with PGP down $.035/lb last month, average Prime PP prices declined
about $.015/lb - although results will vary. There are additional PP increases on the table, so considering
that PGP is primed to decrease about $.035/lb again in Sept, it is plausible to see a repeat in the contract
Michael Greenberg PP market as well.

312.202.0002
@ResinGuru

Contract

Disclaimer: The information and data in this report is gathered from exchange observations as well as interactions with producers, distributors, brokers and
processors. These are considered reliable. The accuracy and completeness of this information is not guaranteed. Any decision to purchase or sell as a result of
the opinions expressed in this report will be the full responsibility of the person authorizing such a transaction. Our market updates are complied with integrity and
we hope that you find them of value. Chart values reflect our asking prices of generic prime railcars delivered in USA.

Dominick Russo and Jay Schreiber Editors

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