Interesting times indeed! Due to the lack of demand
for raw materials worldwide, we have seen an
immediate drop in commodity resin prices in USD
terms. This will translate into an easing of our ex-
store stocks of Polypropylene and Polyethylene as we
receipt new stocks into our warehouse.
The delay effect of when you will receive these savings
will be determined by when new stocks arrive. We
have
been actively reducing stock levels over the last
quarter to ensure that we can bring in lower priced
stock as soon as possible, and we believe we are
positioned to further drop polypropylene prices in
December.
If you have specific requirements or new opportunites,
please do not hesitate to call us to ensure you can
remain competitive in these challenging times.
For non commodity grades, including Santoprene,
Elastochem have been negotiating with suppliers to
reflect the drop in commodity pricing, and strength in
USD. However there will be a lag effect with these
type of products, as there was when prices increased
over 2007 and 2008.
However the effect of the weaker NZD will have a
significant impact on stocks that are being receipted
now and that are still on the water. Hence you may
see an increase in the price of Santoprene, Escorez,
and EEB resins over the short term. These increases
will be grade specific, determined by the stocks being
receipted against forecasts.
We will however pass on any price decreases as they
are negotiated. We will keep you updated with resin
pricing in our future newsletters.
