EUROPEAN PROCESSORS
Energy surcharges from resin makers said to endanger shops / Return of fees “regrettable” / Polymer suppliers complain about effects of price pressures
 Are even darker times ahead for shops and energy surcharges? (Photo: PantherMedia/aa-w) |
The decision by plastics manufacturers to reintroduce so-called energy surcharges for their products has been criticised by the Polymers for Europe Alliance (Brussels; www.polymercomplyeurope.eu/pce-services/polymers-europe-alliance), a group created by Europe’s plastics processors to share information on polymer supply and work with materials manufacturers.
The pressure on shops is immense, the alliance said. “At a time when suppliers’ hedging arrangements are infinitely variable and the impact of government support to control energy costs is also anything but clear, it is putting converters in an impossible position to ask them to endeavour to pass these costs down the supply chain. Absorbing them at some of the levels proposed would eradicate industry margins.”
The alliance attacked such price hikes earlier this year, with group president Ron Marsh telling Plasteurope.com that their consequences could be “disastrous” (see Plasteurope.com of 09.02.2022). Since then, many of the fees have been withdrawn. “It is therefore especially regrettable that this type of increase has re-emerged in some places in recent weeks,” the alliance said.
The timing of additional surcharges comes after steps have been taken to improve market conditions, it noted. “Despite the war in Ukraine and some of the climate change issues having to be addressed, some semblance of normality appeared to be returning to the plastics supply chain. It is very much to be hoped / expected that wiser counsels prevail and these surcharges are once again removed from suppliers’ negotiating armoury.”
Processors may feel a respite as upstream costs ease, with prices for standard thermoplastics seen moving largely downward in part due to declines in energy costs, according to Plasteurope.com data (see Plasteurope.com of 14.10.2022).
The pressure on shops is immense, the alliance said. “At a time when suppliers’ hedging arrangements are infinitely variable and the impact of government support to control energy costs is also anything but clear, it is putting converters in an impossible position to ask them to endeavour to pass these costs down the supply chain. Absorbing them at some of the levels proposed would eradicate industry margins.”
The alliance attacked such price hikes earlier this year, with group president Ron Marsh telling Plasteurope.com that their consequences could be “disastrous” (see Plasteurope.com of 09.02.2022). Since then, many of the fees have been withdrawn. “It is therefore especially regrettable that this type of increase has re-emerged in some places in recent weeks,” the alliance said.
The timing of additional surcharges comes after steps have been taken to improve market conditions, it noted. “Despite the war in Ukraine and some of the climate change issues having to be addressed, some semblance of normality appeared to be returning to the plastics supply chain. It is very much to be hoped / expected that wiser counsels prevail and these surcharges are once again removed from suppliers’ negotiating armoury.”
Processors may feel a respite as upstream costs ease, with prices for standard thermoplastics seen moving largely downward in part due to declines in energy costs, according to Plasteurope.com data (see Plasteurope.com of 14.10.2022).
Plastics producers warn of dangers to industry
Brussels-based Plastics Europe (www.plasticseurope.org), which represents resin makers, declined to comment on the latest statement from the processing organisation. The suppliers’ group directed Plasteurope.com to its online statement about the impact of energy prices on resin makers. “The crisis has highlighted the vulnerability of the European plastics industry, and we are concerned that it will erode Europe’s competitiveness and undermine the investment and innovation required to transition to a circular plastics economy.”
European resin producers only supplied 15% of the world’s plastics in 2021, a mark that matched the previous year’s percentage but was well short of the 19% reported for 2017, Plastics Europe said in its annual report (see Plasteurope.com of 20.10.2022).
“This confirms a loss of competitiveness that could be exacerbated further by energy and logistics crises resulting from the war in Ukraine and the ongoing Covid pandemic,” Plastics Europe MD Virginia Janssens wrote about the situation.
The report was released at a press conference at the K 2022 show in Düsseldorf, Germany (www.k-online.de), where Janssens said, “We have a very fluid, dynamic situation,” something she noted was true for both energy imports and the response from EU officials.
Plastics Europe president Marco ten Bruggencate warned against a deindustrialisation of Europe at K 2022, where he said the European plastics industry is currently in a “very, very difficult phase” (see Plasteurope.com of 26.10.2022).
European resin producers only supplied 15% of the world’s plastics in 2021, a mark that matched the previous year’s percentage but was well short of the 19% reported for 2017, Plastics Europe said in its annual report (see Plasteurope.com of 20.10.2022).
“This confirms a loss of competitiveness that could be exacerbated further by energy and logistics crises resulting from the war in Ukraine and the ongoing Covid pandemic,” Plastics Europe MD Virginia Janssens wrote about the situation.
The report was released at a press conference at the K 2022 show in Düsseldorf, Germany (www.k-online.de), where Janssens said, “We have a very fluid, dynamic situation,” something she noted was true for both energy imports and the response from EU officials.
Plastics Europe president Marco ten Bruggencate warned against a deindustrialisation of Europe at K 2022, where he said the European plastics industry is currently in a “very, very difficult phase” (see Plasteurope.com of 26.10.2022).
01.11.2022 Plasteurope.com [251485-0]
Published on 01.11.2022