Plastic products’ sales not on upswing, despite price fall

The retail sales of plastic products are not up to the desired level. —

The retail sales of plastic products are not up to the desired level. —   | Photo Credit: Photo: R. Shivaji Rao

K. Lakshmi

CHENNAI: The prices of plastic products of daily use have dropped by around 30 per cent in the past one month on the back of a decline in the cost of the raw materials. Yet this is not pushing up the retail sale. Plastic processors say the customers are expecting the prices to fall further.

The downtrend comes after several months of high cost of the raw materials and as a result, the products too. The price of the products shot up in June up to last month, traders say.

G.Shanmuganathan, a wholesale trader in Mint, said a 25-litre bucket, which was priced at Rs.90 in June. now costs Rs.60. Similarly, plastic pots priced at Rs.85-Rs.95 in June are now sold for Rs.55-Rs.60 each.

Members of the Tamil Nadu Plastics Manufacturers’ Association (TAPMA) said the declining price of crude oil influenced the price of raw materials, which has come down by 50 per cent.

The cost of polypropylene, one of the important raw materials, has dropped from Rs.100 a kg in June to Rs.48 a kg now.

Similarly, the price of low-density polyethylene used to make milk and water sachets has come down by Rs.40 a kg this month.

But, the quantum of drop in retail prices of the plastic goods is less as the manufacturers also have to add the production cost, the members add.

‘Customers waiting’

TAPMA executive committee member B. Swaminathan said the retail sales had not improved as customers seemed to be waiting for further fall in the prices.

This is more the case with households that want to replace the old products.

President of the Association Madan Surana said that with retailers putting pressure on manufacturers to cut prices in tune with the drop in raw material cost, it became difficult for the processors to sustain their margin.

The Tamil Nadu Pondy Plastics Manufacturers and Merchants Association president, G. Sankaran, said that though the manufacturers would have to suffer loss in such a situation, this trend would be there, only for a short term as prices would stabilise in two or three months.

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