• Stable lead times for most common gauges.

• While demand for automobiles remains strong, automakers continue to struggle with the ongoing semiconductor shortage.
• Due to such shortages, automakers in recent months have either curtailed production or halted assembly lines altogether.
• Steel products consumption failed the market expectation due to a slowing in the property market and infrastructure construction in China.

• Iron ore price was $94.71 per metric ton on November 29, 2021.

• No change in lead times for most common aluminum and copper types.

• Supply is stable for aluminum and copper.
• Copper prices, which surged in 2021, are expected to retain most of this gain in the years ahead, with demand supported by the economic recovery and the expanding use of copper in low-emissions technology.

• Copper price was $4.39/lb on November 29, 2021.
• Aluminum price was $1.20/lb on November 29, 2021.

• WTI price was $66.31 per barrel as of December 2, 2021.

• In North America, supply continues to improve. The backlog of orders at PC producers is expected to improve in Q1’22. The polycarbonate market in Europe can be described as balanced with no major unplanned or planned outages reported.
• Demand into the different sectors was heard to be softening and consumers seem cautious in taking any large quantities of product at the current elevated price levels. In Asia, PC prices set to shift downward into Q1’22.
• Flame retardants, pigments and glass fibers are still in very short supply. Lead-time for these specialty grades will continue to extend and should result in higher costs.

• In North America, supply is tight due to a combination of constrained feedstocks and overdue scheduled maintenance.
• In EU, ABS prices are expected to rise as the market responds to the unprecedented surge of energy prices. The Asian ABS market has entered a different level of uncertainty as up to 2 million tons of new capacity could be added in mainland China next year.
• As a result, the Asian ABS market will be in oversupply and will be dependent on voluntary production cuts or shutdowns by existing facilities.

• Prices remained elevated through 2021 and will continue into 2022. One producer (Dupont) has lifted their force majeure status on November 12, 2021.

• Demand is still outstripping supply and the market remains tight, exacerbated by factors such as freight costs, force majeures from producers.

• Market becoming more balanced, but price pressure is still strong due to rising upstream costs and restrictions on supply.

Resins Price Forecast - North America 

Resins Price Forecast - Western Europe

Resins Price Forecast - Asia Pacific 

• Box makers told P&PW they were now receiving their linerboard and corrugating medium slightly faster. Containerboard shipments to box plants were taking four to five weeks on average, small and large boxmakersreported. One added that supply appeared to flow better in the eastern part of the USA overall than on the west coast, where there were still reports of slow supply of corrugating medium.
• North American boxmakersreported delivery times of three to four weeks on average yet there were some deliveries taking two months to reach the customer. Several manufacturers are taking orders in November for January delivery. They continue to forecast good to steady box demand with no reduction in demand foreseen. Some are turning away business mainly because they are limited on how many boxes they can make because of a shortage of labor.

• North American boxmakers continued to resiliently battle supply chain and labor disruptions that are slowing their business flow, while containerboard prices domestically held in place with limited discussions about price relief or another price increase.
• US unbleached kraftliner board export pricing increased in just two of four export markets in the last few weeks. This was the first time that increases only covered two regions, after occurring in at least three to four for 14 straight months (since October 2020). North American box makers implemented their third box increase without much opposition this fourth quarter.
• Paper supply today compared to six, seven months ago has settled in with the right amount of paper in the right places at the right time. However, looking forward, market conditions indicate that the International Paper (IP) Prattville, AL, mill shutdown could impact market supply into January.
• The Prattville mill is one of North America’s largest in containerboard, with 1.12 million tons/yr of unbleached kraftlinerboard capacity. One machine at the mill is expected to be down for one month and another is expected to be down for at least two months, based on an announcement this week from IP. The Prattville mill capacity is almost 4% of North American linerboard capacity on an annual basis and Prattville’s estimated downtime could equal at least 2% of US linerboard fourth-quarter production.
• Transport, labor issues remain. Transportation and labor problems continue to slow the box business. One mid-sized integrated company representative reported the company’s average trucking cost from mill to converting plants was about 66% higher today than pre-pandemic. That amounts to an additional trucking cost of about $30/ton.
• Box plants continued to seek workers. One national box maker told of his company recently increasing a pay and benefits package for new hires. About 3% of one large national box maker’s plants saw their volume reduced because they just didn’t have enough workers to run more shifts and make more boxes.
• The trucking problem mostly affected movement of containerboard to converting plants, rather than the movement of boxes to the marketplace.

Prices will remain flat on Linerboard #42. However, we expect an increment on SBS material (Solid Bleach Sulfate Board – Mainly used on Pretty Boxes). This type of material has increased 19%-24% during the last 12 months, like corrugated material.

Each region will reflect its impact depending on its market conditions. Plastic and wood are the main drivers.

LDPE Forecast Demonstrating a Downtrend

• China implemented environmental controls on plastic free.

Paper Forecast Demonstrating an Uptrend

• Wastepaper trends almost align with paper, signs for uptrend.
• Suppliers are grabbing available inventory due to COVID-19 panic.
• Mid-year climbing is now the normal practice.
• Currently, China is in a low-demand situation but showing signs of recovery.

• For the next 3 months, there is a low-medium risk of constraints and allocation of supply for solder and flux products.

• The price of metals in the market is strongly impacted by the economic, political, and environmental factors happening around the world.
• Energy costs are spiking globally driving the production of finished goods up. In some regions, the cost of energy has more than doubled in 2021, and according to World Bank’s latest Commodity Market Outlook energy prices are expected to average more than 80 percent higher in 2021 globally vs 2020.
• Logistics constraints continue to drive an impact on material costs and delivery schedules. Adjustments to min/max, ROP, and DOH should be implemented within operations to take a more risk-averse position.
• The global economic instability, even in strong economies like the US, prevents the ability to accurately predict what to expect in terms of metal prices controlled by the market.
• The presence of the Omicron variant brings familiar scenarios of uncertainty and market instability caused by swift political directives in several countries to stop the spread.
• High cost of shipping along with an increase on global semiconductor sales in the first 6 months of the year, are also reasons to see the premiums in metals, such as tin.
• The variability of raw material pricing has forced the adoption of a more fluid hedge strategy in which shorter hedge periods are preferred. The development of these strategies must be in alignment with key partners as this will allow for improved reaction to market fluctuations which in turn will minimize commercial impacts.
• While silver and tin are the primary raw materials responsible for the significant increases in bar, paste and wire, copper and lead are other metals that should be monitored for price fluctuations.
• Based on the current market behavior it is advised to explore either alternative sources of supply, or compounds with different alloy content. Strong partnerships with key suppliers will provide the opportunity to leverage their internal capabilities to offset the cost of change and the validation process in analyzing alternative compounds for production.
• The unknown future of the solder alloys requires the investment of a more resilient way to respond to the global disruptions. Having multiple solder supplier options instead of a single-source will provide this resiliency and further mitigate commercial impacts.

• The price for solder products is highly driven by non-ferrous and semi-precious metals as 90-100% of solder products cost could be attributed to these commodities.
• Silver is still at a high price but has seen reduced volatility recently.
• Lead and copper behavior improved, and the increase year to date has reduced to less than 5%.
• There’s little sign of tin pricing reducing, and as predicted it reached $40/Kg (in November); having a huge impact on all alloys for bar, paste and wire.
• All of the alloys within the SAC300 family are suffering due to the increased price of tin, a 10% increase vs last quarter.
• Material not bought on a hedge, could experience intra quarter surcharges due to market fluctuations on precious metal pricing.
• The metal markets price behavior for the past 3 months (Sept 1, 2021 - Nov 30, 2021) on the LME and SMM are as follows:
  • SMM (Shanghai Metal Market): Tin prices increased another 20% and copper increased 2%, however, lead, bismuth and silver decreased 1%, 2% and 9% respectively; the impact of this trend on the quarter will be an approximate increase of 15% on all metal alloys.
  • LME (London metal Exchange): Tin experienced an increase of 15% and copper 2%; silver and lead, however, decreased by approximately 6%. The average impact is a 10% increase on all metal alloys.
  • Tin pricing increased by approximately 17%.
  • Lead pricing decreased by approximately 3%.
  • Silver pricing decreased by approximately 8%.
  • Copper pricing increased by approximately 2%.