The slow and steady drop in oil prices over the past year has many concerned for the health and stability of the economy. This decrease in crude oil costs has been in progress since late 2014, according to Plastics News.
The future of these prices and whether they will increase significantly is still uncertain. Some prices have increased to almost $50 a barrel (compared to $45 and below), but these small increases seem to be short-lived.
It has been predicted that prices will begin increasing slightly in 2016, from about $49 to $53 according to the U.S. Energy Information Administration (EIA); however, the EIA crude oil price summary illustrates that these increases are far from where we once were with crude oil costs.
The plastics industry is often heavily affected by economic changes like these. In the case of cheaper oil, this is actually slightly beneficially to manufacturers like Karat®, as well as its customers. This could be considered a silver lining to the volatile and unclear future of the oil market.
“The plastics industry can expect to have relatively low oil prices for the next two or three years as demand catches up with supply …” according to Plastics News.
For those in the plastics industry this means the price of plastic resins for the creation of foodservice disposables and other plastic products is lower and will probably remain lower for a while. PP, PS and PET resins have all experienced price drops in recent months.
In August, each of these resins experienced a price drop, with PET having the largest decrease in price (4 cents), according to Plastics News. By September, the prices were still lower than normal. Prices have since come up very slightly, but not enough to be felt by those purchasing resin.
Karat has paid close attention to these economic changes and has begun adjusting prices based on how much money is spent on resin. The less money Karat spends on resin, the more money Karat’s customers save on their foodservice disposable products.
This doesn’t only apply to oil prices. When any major economic change occurs nationwide and globally, Karat tries to adjust costs accordingly. Karat understands the importance of working with customers to give them everything they need, for a reasonable price.
Changing prices based on current events is only a fraction of what the company does to support customers. Be sure to contact us to learn more about what Karat does for its customers.