Green regulations raise Chinese plastic prices
November 23, 2018
The tightening of environmental laws in the Asian nation is causing a spike in prices of high-performance plastics.
According to Nikkei Asian Review, companies such as Toray Industries and Mitsubishi Engineering-Plastics are raising the prices of polybutylene terephthalate by around ¥25 (22 cents/19 euro cents), causing a knock-on effect for the manufacture of electronic components, which often uses the material.
This is due to tougher emissions restrictions on the country’s production facilities, which has caused a reduction in supply of crude oil and naphtha, and therefore an increase in the price of purified terephthalic acid (PTA), a key feedstock derived from naphtha.
Last spring, both Toray and Mitsubishi announced 10 percent price increases on polybutylene terephthalate, owing to rising feedstock and transport costs. Further hikes now could push the market price of the polymer to ¥450 ($3.98/€3.51) per kilogram.
The tighter regulations are also pushing up the prices of acrylonitrile butadiene styrene resin (ABS), with both Toray and Techno-UMG, Japan’s largest producer, “negotiating toward a hike of at least 10 percent,” according to Nikkei.
However, Nikkei further states that it will be “an uphill battle” convincing customers to accept the price increases on high-end plastics, as although “producers face little competition from imports, unlike with commodity-grade plastics, there is by no means a shortage.”
Japanese production of polybutylene terephthalate grew by 8 percent year-on-year for the first eight months of 2018, whilst there was a slight drop, of 4 percent, in ABS resin output, according to figures released by the Japan Plastics Industry Federation.
Categories : Around the Industry
