The war in Ukraine continued to bring uncertainty to the markets as people tried to work out what will occur as a result.
In the plastic market, rising oil prices brought about a view that virgin prices are likely to rise, so scrap plastics will be up too.
While the war isn’t behind some metal grades jumping, it did help to fan the flames.
But for paper grades, there were worries that demand could suffer as the increased cost of living will be exacerbated by the conflict.
The PRN/PERN market remained sluggish but there were some signs of life with a few more trades than had been seen in recent weeks. Many in the market don’t want to get burned like they did last year, before obligations come out.
The pound seemed to be dropping too against the dollar to $1.32 at the time of writing from $1.34 last week. This is the lowest since December. But compared to the euro it was up to €1.20 from €1.21 last week.
It was a strange trading environment this week, with the invasion of Ukraine by Russia very much at the forefront of traders’ minds.
With oil prices rocketing, film buyers in Europe in particular wanted to stock up on high quality materials in particular due to fears scrap prices would also go up rapidly. Of course, this meant rising prices for both LDPE 99/1 and 98/2.
HDPE bottles were also in very strong demand, despite the strange announcement by Morrisons that they are going to swap to Tetra Pak. Again, this was down to fears that prices may rise even higher.
However, this wasn’t the case with PET, which tends to be a more localised market anyway. Prices for this grade actually came off a little with buyers seeming to be well stocked and resisting buying at higher levels.
With much trading done last week for the month, it was a quieter environment as a result over the last few days.
Markets were relatively stable, but Turkey was keen on OCC and this helped to boost the price of this grade a little more. Inspection destinations were also offering above £170 and closer to mid-£170 if they could get hold of the fibre, which wasn’t always easy. But there was also a wide spread between the bottom of the market and the top.
With mixed, Europe continued to be the main buyer, but interest was weaker and negotiations were tougher. There was a very slight rise in the price, but there was strong resistance.
In terms of the outlook, the paper market feels more uncertain. Some take the view that prices will resume their upward trajectory when trading takes place for April, but others feel the higher cost of living being felt globally (made worse by the invasion of Ukraine by Russia) will bite demand for fibre.
With European stocks of copper and aluminium poor, there was a scramble to get hold of metal this week, especially with reports that mining volumes of these metals were down in South America. With the war in Ukraine also potentially causing supply chain issues due to Russian mines being subject to sanctions, prices of these grades jumped up – by £300 per tonne in the case of copper.
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