Spiraling polymer prices are causing great concerns to the
plastics and allied industries, and have been the hot topic
of discussions over the last few months. Escalating oil prices
have been blamed for the rise in feedstock prices, which in
turn have led to rising polymer prices, currently lingering
at record peak levels. Read
more in Why
are oil prices rising?
When will the rise in oil prices and subsequently feedstock
prices be arrested? Will polymer demand be affected by high
prices? These are few of the questions raised by the industry.
Read more in the speech
by Mr PP Kharas, President OPP on 27 Aug 2004 at the AGM of
OPPI. Let us look
at the increase in the prices of oil, feedstocks and polymers
and ascertain whether an increase in oil prices has resulted
in the increase in prices of the basic feedstocks or is booming
demand leading to an increase in polymer prices? Will demand of polymers be adversely affected due to higher prices?
The rising costs of energy products do not seem to have caused
any major upheaval so far. The present outlook calls for the
growth trend to continue in the second half of the year. Read
more in economic growth forecasts amid soaring oil prices.
An important precursor to a continued
recovery in the manufacturing sector is expanding corporate
profits. Figures from USA indicate total corporate profits
were up 32% in the first quarter of 2004 as compared to the
year before. Other important economic indicators like housing,
construction, packaging, automotive, also portend continued
improvement in the U.S. economy and the plastics sector during
the second half of 2004. Read more in Demand for Plastics in USA : Favourable trends continue in second half of 2004.
Globally the growth rate of plastics at the consumption of
165 million tons in 2003 continues to outperform the World
GDP growth even after 60 years of commercial usage. Click
here to read about World plastic consumption pattern for 2003.