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Highlights
Resin asking prices up $.01-.03/lb to begin the resin trading week/year
Monomers inch up again
More negative manufacturing data as ISM Manufacturing Index misses
President Maduro removed from Venezuelan office by US military
Resin Markets
Welcome back to the office as today really marked the beginning of the year for many market participants. Despite the holidays being over the markets struggled to get going with overall activity low. I believe we’ll begin ramping up tomorrow and we’ll be off to the races chipping away at those 2026 goals.
The flow of offers has yet to really heat up but some offgrade auctions got underway today with low participation. What wasn’t auctioned carried a higher price from end of December and by our observation asking prices were up $.01-.03/lb to begin the conversations. We saw more activity in the PE markets than PP and the higher offers did not discriminate between the export and domestic market.
Even though asking prices were higher there wasn’t an overwhelming acceptance from buyers so our Resindex prices remained flat and we'll wait for confirmation of sales at the higher numbers before adjusting.
Monomer Market
Monomer trading activity was on the lighter side today but both Ethylene and Propylene inched up again. January Ethylene settled the day at $.19/lb while 2Q was done at $.2075/lb. PGP was marked at $.275/lb, also up a quarter cent.
US Economic Data
Another reading was released showing the US manufacturing sector is continuing to slump. The ISM Manufacturing Index fell to 47.9% for December, it missed expectations of 48.3% and was below November's reading of 48.2%. This is the third straight month where the number decreased and is the lowest since October of 2024. A reading under 50 signals contraction and this was the 10th straight month after January and February were expansionary. Aside for those two months we’ve been in contraction for 36 of the last 38 months, yikes.
Production and inventories both declined while higher input prices remained high. There were signs of improvement in new orders, the clearing of order backlogs and export orders. Employment in the sector declined in December. I believe we'll begin to see the fruit from President Trump's policies in 2026 which will help improve domestic resin demand.
Global Trade
President Trump is once again threatening to raise India’s tariffs if it does not curb its purchases of Russia’s sanctioned oil. There have been mixed messages from the Asian nation, at one point in 2025 they defiantly stated they would purchase oil from wherever they chose but more recently have changed their tune after the most recent sanctions. President Trump would like to keep the pressure on Russia to end its war with Ukraine by cutting off one of its major revenue sources. India currently faces tariffs of up to 50% on some goods imported to the US.
Despite tariffs of 20% for goods that head the US, Vietnam has grown its trade surplus with America and its economy has grown. Vietnam has much been talked about as a trans-shipment hub for Chinese goods to make its way to the US and avoid steeper duties and tariffs.
Venezuela
Huge news from the weekend that I’m sure all of you have already heard but the United States on Saturday morning removed Venezuelan President Nicolas Maduro from office. The military operation which was carried out during nightfall brought Maduro and his wife back to the United States where they faced charges today for Narco-terrorism. Both plead not guilty in their first court appearance today in New York.
This news was certainly met with some backlash and support as global leaders were mixed in their reactions. This has major implications for the oil industry which will reverberate into plastics as well. Trump has stated that US companies will be pegged to repair aging infrastructure and ramp up production in the South American country that boasts the world’s largest oil reserves with an estimated 303 billion barrels. Chevron is currently the only US company that operates in Venezuela, their stock was up 5.5% while Exxon and Conoco also gained.
Much is unknown on how the transition of power will go but according to Trump and Rubio the US will be heavily involved. Currently, Maduro’s Vice President Delcy Rodriguez is leading the country but it's difficult to say who is really in charge. Venezuelan oil had sanctions against it already but ramping up production could be as far as 5-10 years away. Most of Venezuelan oil flows to China but the US is the second largest buyer. Crude oil prices were up a $1 today to $58.32/bbl, 1.7%.
Venezuela's oil is a heavier, sour crude versus lighter sweeter crude which is produced in the US. Both have their pluses and minuses. Lighter crude is more easily refined into gasoline while heavier requires more cracking which aids in the production of petrochemicals. The United States is set up to refine both types and as I mentioned earlier already takes approximately 23% of Venezuelan oil.
We will keep you update with how all of this shakes out.
-Dominick Russo, CFA
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