04 January 2013 17:08 [Source: ICIS news]
HOUSTON (ICIS)--Any increase in raw material prices in the next six months will likely come from resins such as polyethylene (PE) and polypropylene (PP), rather than other feedstock such as pigments, the chief executive of US plastics compounder A Schulman said on Friday.
Speaking during a fiscal first-quarter conference call, A Schulman chief executive Joseph Gingo said the company's expectation is for raw material costs to stay flat to slightly up for the first six months of 2013.
"The cost pressure going into the New Year, I think it is going to be coming from resin suppliers, and I don't think it is going to be huge," Gingo said. "If anything, I think it will be slightly up."
Gingo said resin manufacturers are "trying like mad" to get a price increase implemented, but said demand will still govern their ability to push through an increase.
"If things stay flat, they are going to get a little bit, but they are not going to get what they think," he said.
In other markets, such as pigments, which go into more downstream products, Gingo said his expectation is that raw material prices will decline.
"As long as overall markets are down, I don't see how suppliers are going to get any increase," he said.
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