Dive into the detailed analysis of Mintec's Global Packaging Category Index for December, revealing a slight monthly increase. Explore the dynamics in plastics, metals, paper, and glass segments, reflecting on the market trends, production costs, and the overall state of the packaging industry in 2023.

Mintec Global Packaging Index: December Insights and 2023 Overview

The Mintec Global Packaging Category Index (MCI) witnessed a modest 1% month-on-month (m-o-m) increase, reaching $1,402/MT in December. While most packaging materials experienced marginal fluctuations, raw materials for paper and steel production saw price rises over the period.

1. Plastics

In the plastics segment, all prices in Europe declined in December, with EU polypropylene [Mintec Code: 2O53] falling 5.3% m-o-m to €1,301/MT. The EU plastics market remains well supplied, while high costs of borrowing have negatively impacted demand. In the US, the sentiment was mixed, with prices for polyethylene falling on increased stocks and weak demand, while polypropylene and PET prices rose due to logistics disruption in the Red Sea.

For reference, the price of US HDPE [Mintec Code: 2O81] decreased 18.7% m-o-m, to USc 61.3/lb, and the price of US PET [Mintec Code: 2O89] was USc 65/lb, a 1.6% m-o-m increase. In 2023, the demand for plastics in the EU and the US was fundamentally weak, with crude oil prices being a main driver. The US plastic market showed a slower decline in prices compared to the EU market, with US PP [Mintec Code: 2O85] prices soaring 52% y-o-y in December.

2. Metals

In December, steel futures prices in the US market started to decline after dynamic growth in the previous month. The CME's US steel hot-rolled coil (HRC) [Mintec Code: HRCN] 3-month price fell by 13% m-o-m to $1,102/MT. HRC prices in the EU [Mintec Code: 1K01] rose by 5% m-o-m in December to €681/MT as European producers incrementally raised prices to counter rising input costs. Tinplate prices continued to increase in the US and EU in December.

The year 2023 was a complicated year for steel producers as steel prices fell faster than production costs due to weak demand. Aggregate European steel production for the first 11 months of 2023 fell by 8% y-o-y. Despite this, tin prices fell by 16% y-o-y in 2023, and aluminum prices fluctuated within a small range due to a surplus global market.

3. Paper

In December, the packaging paper market showed weaker than expected demand. French Kraftliner 175g [Mintec Code: SZ173] prices fell only 1% m-o-m due to rising pulp costs. French Testliner 2 [Mintec Code: SZ176] declined by 3% m-o-m as producers were able to reduce prices due to a 14% m-o-m drop in corrugated waste prices. The EU's paper production stabilized after reaching a low point in July 2023.

Energy prices, determining the cost of production, offset the price increases of the previous two years in 2023. Market players expect pulp prices to be a possible growth driver, with Northern Bleached Softwood Kraft (NBSK) pulp [Mintec Code: EX24] rising by 11% over the past four months.

4. Glass

The container glass market continues to face declining demand amidst high borrowing costs. Natural gas prices [Mintec Code: NGNL] are decreasing, and the cost of raw materials, silica sand [Mintec Code: TT51] and soda ash [Mintec Code: WY31], remains a watch-out factor due to potential shipping disruptions in the Red Sea.

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Keywords

Mintec Global Packaging Category Index , packaging materials , raw material prices , plastics , metals , paper , glass , market trends , production costs

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