Although it was a relatively quiet week for underlying prices, the PRN/PERN bumped up for plastics and to an extent paper grades.
There is a view that sometimes when the plastic PRN/PERN drops that it then bounces back up and this seemed to happen to it this week. There was also a small effect with paper.
But for some grades, underlying prices actually dropped a little.
Market pessimism is strong at the moment and there are few that are optimistic that these challenging conditions will now improve before Christmas. However, as we get closer to the end of the year, thoughts are starting to turn to 2024 and what that will bring.
The pounds was trading at $1.22 against the dollar down from $1.23 a week ago. It was at €1.14 compared to the euro down a cent from last week.
Film grades saw underlying prices fall on the back of slightly weaker demand from both Europe and other destinations, but this was masked by the bounce back of the PRN/PERN seen this week.
With a gain of £50 per tonne for the note, packaging grades picked up in value, which provided some assurance after a tough few weeks since the PRN/PERN value halved at the end of October.
While it isn’t unusual for the PRN/PERN to come back a bit after a recent fall, many in the market fear a volatile rest of the year.
Volatility makes trading harder with companies having to work out how to budget and where to set prices.
Therefore, many will be hoping for a bit of stability as then they know where they stand.
With most trading for November already done, this week saw the small number of orders moving a quid or two down for OCC and mixed.
Even though there was a slight uptick in the value of the PRN/PERN, it wasn’t enough to stop these grades coming down a little.
European mills are reportedly looking at maintenance and idle time in the run-up to Christmas when markets are quiet, but they have been showing lack of market interest since late summer on the whole.
Deep sea has been the key market in recent weeks, but there are signs that this market isn’t quite as eager as it has been. However, sometimes the price will hit a level that leads to buyers piling in, and this could happen again. Most wouldn’t expect that until trading for December takes place, and even then it might be that well-stocked mills won’t feel the need to re-stock until next year.
Copper and brass both dropped by £50 per tonne, but ferrous grades increased by £5.
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