Plastic resin prices slipped again in January as both demand and feedstock costs fell. Twenty-eight percent of resins buyers surveyed in January said their demand was flat while 55% said they were buying less that month. PURCHASING Magazine's index of transaction prices for plastic resins (1992=100) dropped to its lowest level (107.6) since June of 1999. Compared to the previous month, prices for products purchased in January were flat for 67% of resin buyers surveyed and down for 31%. Only 8% of buyers surveyed expect resins prices to rise over the coming three months while 69% see pricing as flat and 22% foresee declines.

At present, resins buyers are ordering only to meet processing requirements, and these are near all-time lows. Analysts say plastic parts processors are running at very low operating rates. On average, one in four injection presses is sitting idle for lack of molding jobs. "So, even with prices dropping as end-use demand has slid, resins buyers still see no need to refill their shelves," says Bob Beil, polyethylene commercial director for maker Dow Chemical Co. of Midland, Mich. Sales of most major resins dropped in 2001. "Inventory rundowns coupled with demand losses have made this market hit bottom,'' adds John Hotz, polyethylene business director for Nova Chemicals Corp. in Pittsburgh.