BarCap adds industry name to plastics business

Barclays Capital has bolstered its plastics business with the appointment of David Paul as director of commodity sales in London. Paul joins from the New York based brokerage firm Refco, where he was global head of plastics futures trading.

Barclays Capital already trades derivatives on polypropylene and polyethylene, and plans to extend its offering to include futures on the building block (monomers) of these plastics – a market that it estimates could be worth trillions of dollars.

Increased volatility in the plastics markets has prompted a number of market players to enter the derivatives market over the past year. In a six week period, the price of polyethylene moved from $900 to $1400 per tonne, dramatically upping the cost for manufacturers of plastics products worldwide and sparking demand for futures and options contracts.

The London Metals Exchange launched a plastic futures contract last May, and although trading last year remained low – polypropylene attracted only 15,770 trades last year compared with more than 10 million contracts for copper, zinc and aluminum futures – Barclays Capital remains optimistic that demand will take off.

"Plastics are used everywhere and the whole industry is faced with this increased volatility,” said Paul. “Barclays has a big footprint in the industry, and there’s been more and more interest since the LME announcement last year. There are lots of eyes watching this space.”

In his new role, Paul will report to Orrin Middleton, head of European corporate commodities sales.