An overview of the resin market and long-term analysis

Shippers have many questions in any market, but resin is a hot commodity that raises its own set of questions. How has the resin market performed in the past year in the face of traffic jams and operational problems worldwide? How will the resin market fare when port congestion and terminal issues finally seem to be easing? We address these and other questions in this blog post.

The logistical position

Despite increasing their capacity, US chemical and plastics manufacturers have struggled to reach overseas markets over the past year due to rising shipping costs, port congestion, equipment shortages and capacity constraints.

Volumes in 13 of the top 20 export markets fell in 2021, with seven of those countries reporting double-digit percentage declines. The largest falls were seen in Malaysia (29.7 percent) and China (21.1 percent), the largest importer of US-made chemicals and plastics. However, those declines were partially offset by double-digit percentage increases in exports to Belgium (11.6 percent) and Brazil (16.1 percent), the second and third-largest US chemical export markets, respectively, according to Paul Bartlett’s findings from Seatrade Maritime News.

Resin exporters and shippers have also had difficulty obtaining export reservations as shippers continue to prioritize empty containers being returned to Asia. Shippers exported an average of 1.6 billion pounds of resin per month from October through February, but in a “normal” operating environment, US shippers export up to 2 billion pounds per month.

The market

Falling domestic prices will make US resins more attractive to foreign customers, especially when operational problems and delays stop. The latest news of such issues, delays and congestion in ports continues to bring hope and positive impact to all parties involved in the supply chain, signaling that the market is moving in the right direction.

Port congestion has gradually eased and opportunities for exporters to find reservations and load at more competitive rates will increase. Undoubtedly, this situation, along with the situation on the domestic market where prices are falling, will prompt US exporters to seek overseas customers and increase their profits.

The easing will also reduce the costs for exporters, which have risen in the past, and speed up operational processes. At this point, it is very important for exporters to cooperate with freight forwarders to get competitive prices and get rid of operational difficulties to make the process faster. Freight forwarding companies have specialized services, efficient and stress-free processes for transporting goods and the necessary knowledge about shipping goods.

Finally

Additionally, exporters can get much more competitive prices due to the container volume they book and shippers allow them to be more competitive through the prices provided. Shippers and carriers can significantly reduce costs by providing good customer service during this process, anticipating and preventing mistakes, and establishing an organized system for goods delivery.

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