What do regional plastics contracts for Asia, Europe and North America offer the industry?
Regional contracts for plastics reflect the different fundamentals in the regional markets and therefore the price differentials that occur between regions. In addition, regional prices reflect existing industry practise and are more familiar to the industry than global prices. However, global prices allow those participants with global exposure in different regions to price and hedge this on a forward basis until a regional commitment becomes evident. They also help to improve price correlations with the physical market and offer opportunities for arbitrage trading.
