Recent polymer price increases are endangering the recovery of plastics markets, the European Plastics Converters Association (EuPC, Brussels / Belgium; www.eupc.org) said in presenting its annual economic report for 2009. Converters are unable to pass these hikes down the value chain to their customers, association managing director Alexandre Dangis remarked, adding that the “markets are currently too fragile” to cope with increases of this size.

EuPC figures show that Spanish and Italian manufacturers of plastic products have suffered especially from the economic downturn, with production down 26% and 27% respectively. Since the crisis first hit in 2008, converters – with volume setbacks of 25% – have held up better than the other industry segments. Polymer producers’ volumes have slipped 32%, and machinery makers have had to cope with a far steeper decline of 69%. Consumer packaging has been least affected, with production down 15% since 2008. Industrial packaging, by contrast, continues to suffer “heavy losses.”

Along with higher prices for their starting materials, “which are not allowing slight business gains to be consolidated,” converters face other constraints. Illustrating how difficult the situation is in some quarters, Dangis said investment in new plastics converting machinery has almost completely dried up, and European converters are unable to find sufficient credit insurance to take on risks and generate growth.