Resin Pricing and Lead Times: Where We’ve Been and Where We Are Right Now

Happy New Year! We hope 2018 is off to a great start for you both personally and professionally.

Well, 2017 was quite a wild year for polyethylene pricing. The best summary we’ve seen comes from a recent Plastics Exchange newsletter, so let’s take a look:

“The market rallied in the 1st quarter and bottomed out near the end of the second quarter. It staged a modest recovery during the summer for what should have been its last hurrah before several new polyethylene plants came online with added production. Hurricane Harvey then rocked the market and sent prices absolutely soaring. The market peaked in mid-Sept and has been sliding ever since. Most PE resins still remain several cents higher for the year, but grades did not necessarily move together or to the same magnitude.”

Indeed, while prices have been trending down since the steep increases last fall, they’re still ahead of where they were for much of last year. What’s more, resin rose $.01/lb over the last week, and one producer just nominated another increase for February of $.04/lb. While it’s too early to tell if that will take hold, there are some rumblings that other producers will follow suit. As always, we will keep you updated on any major developments.

As for our schedule, we’re currently looking at 2- to 3-week lead times, and we expect those to tighten up a bit now that the holidays are behind us and 2018 is in full swing. If you’re planning any orders for the next month or two, now would be a great time to reorder or request a quote.

If you have any questions or comments about this update or would like to place an order, please let us know. Thank you for your continued business, and we look forward to serving you.

Merry Christmas and Happy New Year!

No matter how you celebrate the holidays, it’s a great time to slow down and reflect on the blessings you’ve received over the past year.

We’re truly thankful for customers like you and feel very fortunate that you’ve chosen us to be your supplier. Your impact is felt throughout the company and in all of our lives.

In the spirit of this Christmas season, we hope you’ll pass on our blessings to those closest to you.

Wishing you and all your loved ones health, happiness, and prosperity now and in the New Year.

The Unfair Advantage

Author, entrepreneur, and marketing legend Seth Godin recently posted a thought-provoking piece called The Unfair Advantage. It’s short, so there’s no point in summarizing. Here it is in its entirety:

Here’s a sign I’ve never seen hanging in a corporate office, a mechanic’s garage or a politician’s headquarters:

WE HAVE AN UNFAIR ADVANTAGE:
We care more.

It’s easy to promise and difficult to do. But if you did it, it would work. More than any other skill or attitude, this is what keeps me (and people like me) coming back.

When I read this, I was immediately struck by how relevant it is to our perspective at A-Pac Manufacturing. Our quality policy is “to provide the best bag- or film-buying experience available in our product niches.” We take that to mean not only using the best raw materials to make the best quality poly bags we can, but also providing an exceptional experience for our customers throughout the buying process. Maybe we haven’t explicitly said it, but we truly do believe we care more than the competition. We hope we have proved that to you with friendly interactions, quick response times, and always going over and above what you expect from your poly bag supplier.

Our commitment to providing the best bag-buying experience is a comprehensive one—that is, one that not only includes the end product but how you’re treated along the way. We believe we care more, and we believe that gives us an unfair advantage. We hope you agree.

Resin and Lead Time Outlook – November 2017

As you know, there’s been no shortage of news related to resin pricing over the last couple of months thanks to Hurricane Harvey. Now that November is here and some of the dust has settled, we thought it would be a good time to send out another update.

The proposed resin pricing increases of $.07/lb we mentioned last time have indeed gone through, with some producers even adding in an additional $.03/lb, for a total of $.10/lb since August.

To help understand why this has happened, let’s look at what The Plastics Exchange said in their most recent update:

Harvey’s impact on PE production was extreme, with many reactors shut for varying lengths, [and] operating rates only averaged 75% in Sept. Rapidly rising spot prices curtailed incremental exports, with less than 600 million lbs sent offshore, while domestic demand remained healthy. Together overall demand contributed to a massive 435 million lb upstream inventory drawdown, which was quite evident in tight Sept/Oct supplies.

Now that most petrochemical plants have come back online and supply issues seem to be easing, we hope this will be the last of the increases for a while.

As for lead times, we’re currently looking at a 3 to 4-week window. If you know you’ll be placing an order in the next month or two, please let us know as soon as you can so we can schedule accordingly. We always strive to meet 100% of all our due dates, but any advance notice you can give us would be much appreciated.

If you have any questions or comments about this update or would like to place an order, please send us an email or call us at (800) 272-2634. Thank you for your continued business, and we look forward to serving you.

How Do VCI Bags Work?

To understand how volatile corrosion inhibitor (VCI) bags work, it’s helpful to know what causes corrosion in the first place. Corrosion is the process in which a metal is destroyed by a chemical reaction. The most common example of corrosion is the oxidation of iron in the presence of water and oxygen, otherwise known as rust. Most people know that rust will occur when iron comes in contact with liquid water, but it can also occur from contact with moisture in the air.

Many VCI bags are coated with compounds, inside and out, that act as a barrier between the metal and the corrosive substance, but many find these coatings less than ideal because of the residue they leave behind. At A-Pac Manufacturing, we integrate volatile corrosion inhibitors directly into molten polyethylene. The polyethylene is then fabricated into bags and films of various sizes. The end result is a product that emits anti-corrosive vapors that act as a barrier between the metal and corrosive substances. Because the anti-corrosive action of our bags is through vapor, customers never feel or see a coating on any of their products.

It’s easy to underestimate the importance of VCI bags because of their seemingly secondary role as product packaging, but their ability to keep metals in pristine condition while in storage or transit to their next destination is absolutely essential when a company needs to deliver a product that meets their customers’ exact specifications.

Please note that we do not make any claims as to the effectiveness of our VCI bags. While we do guarantee that the volatile corrosion inhibitors are added to the bags and in the correct amounts, it is up to the purchasers to verify that the bags work in their specific environment for their intended purpose.

As always, if you have any questions about VCI bags or anything else at all, feel free to send us an email or call us anytime at (800) 272-2634.