Commodity market news on March 9, 2022

SMALL INDUSTRY NEWS

WORLD'S GOODS HIGHLIGHTS DAY 09.03

US exports of scrap plastic in 2021 were down 12% year-on-year, with a volume of about 1.2 billion pounds (~600k tons). Since China introduced a policy of prohibiting and restricting the import of iron and steel scrap and plastic waste in 2017, the amount of waste plastic exported to the US has decreased significantly. In 2021 alone, the export of waste plastic to Vietnam has decreased by about 31%.

Potential risks from the Russia-Ukraine crisis to the global petrochemical industry

The world oil price continued to surpass the threshold of 130 USD/barrel when the crisis between Russia and Ukraine showed no signs of cooling down. This is a cause that directly affects the global petrochemical industry, and the risk of price increases and supply shortages will still pose many concerns to both supply and demand this year.

The spike in energy prices will clearly have a knock-on effect on production, especially in Europe, which will dampen the recovery of global trade after the Covid-19 downturn. Currently, Russia has a great advantage in exporting oil, gas and coal much more than polymer. However, Chemorbis statistics show that Russia exports about 2.4 million tons of polymer per year, which is also a significant amount of the total global polymer production. PE plastic accounts for half of Russia's total polymer exports, while PP also accounts for 30%. The main destinations of plastic produced in Russia are China (PE plastic) and Türkiye (PP plastic).

The skyrocketing crude oil price also caused the price of polymer in general and PET plastic in particular to increase. Demand for PET plastic is at a high level in the first half of the year, and exporters in Asia are benefiting from this increase in demand. Currently, China accounts for 35%, Taiwan accounts for 10%, the Netherlands and India accounts for 7% and South Korea and Thailand account for 4% and 3% respectively of the global PET plastic export market (public figures). published by Chemorbis). The surge in demand for PET bottles sent PET bottle prices to their highest levels since November 2018.

The US, Japan and Europe are the places that are importing a large amount of PET plastic bottles in the context of high oil prices, importers are worried that PET plastic prices will increase sharply in the near future. Currently, Europe, including Russia and Ukraine, accounts for 30% of the total import demand for PET plastic in 2021.