Weakness of the GBP Against the Euro Negates the Expected Price Reduction, and Are There Any Implications of a Bounce in Crude Oil Prices.
It is clear that the financial markets are becoming increasingly nervous about the implications of the UK exiting from the EU.
As negotiations between the Government and the EU progress, it looks increasingly likely that the BREXIT referendum will be taking place this summer. The result of the concerns over the UK’s future are evident in the current weakness of the GBP versus the Euro, where the value of Sterling has dropped by almost 8% since the beginning of December and by 0.04€ in January alone.
Given that PE, PP and PS prices are effectively Euro denominated, this has meant that UK processors have not enjoyed the monomer-related cost reductions enjoyed by competitors in the Euro Zone.
This effect is illustrated in the graph and table to the right, and the ‘Difference per Tonne’ can readily be compared to the ‘Monomer Prices’ provided.
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The concept of a user friendly market report came from feedback about an article published in PRW (Plastics & Rubber Weekly) about the 2011 market outlook to which Plastribution made a significant contribution.