Resin Price Report: Eager Buyers Stymied by Tight Supply

Spot resin demand, both domestic and from export markets, maintained an above average pace the last full week of April.

Spot availability for polyethylene (PE) was fairly snug, and it was outright tight for polypropylene (PP), according to the PlasticsExchange. Strong buyer interest lent some support to spot pricing, with Prime PE and PP prices holding steady from the previous week after declines earlier in the month, according to the Market Update from the resin clearinghouse.

PP down $0.10 to 0.11/lb.

As contracts inched toward finalization, it appears that April PE is rolling flat while April PP looks to be settling down $0.10 to 0.11/lb in tandem with polymer-grade propylene (PGP). American Chemistry Council (ACC) data for the month of March confirmed a rise in production and upstream inventories for both PE and PP. ACC subscribers have access to detailed supply/demand data.

Prime PE prices hold steady.

Activity picked up in the PE marketplace, but the uptick in trading and demand was not enough to lift pricing. Prime PE grades held steady for a third straight week at the PlasticsExchange trading desk. Linear-low-density PE for film and injection continued to be the biggest mover, followed closely by low- and high-density PE.

The PlasticsExchange reports buying some prime PE railcars to replenish its market-making inventory. Its export business remained healthy, although prices eased a tad to bring transactions to completion.

No movement in PE contracts.

The PlasticsExchange said it still expects to see PE contracts roll flat for the third month in a row, which would leave the price up $0.03/lb for the year so far since the successful January increase. If the nominated increase does not stick in April, producers will give it another shot in May.

PP trading started the week softly, but business picked up as the week wore on and ended with heavy turnover, according to the PlasticsExchange. Completed volumes largely favored prime homo-polymer PP, with copolymer PP transactions once again limited by availability.

Lower prices incentivize processors to restock.

Generally speaking, demand was very good the week of April 22, as some processors have drawn down their inventories looking to restock at lower prices, some of which are at hand. Overall availability has been tight, even as prices drop. Packaged truckloads have largely been depleted, as resellers wait for new and cheaper cars to package. In the meantime, truckloads are carrying a sizable premium to railcars.

Contract buyers are enjoying significant cost relief in April: Though contracts have yet to fully settle, they are leaning toward a $0.10 to 0.11/lb decrease commensurate with the drop in PGP costs.

Spot PP prices held steady this past week. Upstream inventories built substantially in March, but some of it has been held for customer supply during turnarounds, while there has also been strong contract purchases in April.

Read the full Market Update on the PlasticsExchange website.

Visit the PlasticsExchange at NPE2024 in booth S29027, where it will introduce its new market intelligence platform. NPE is at the Orange County Convention Center in Orlando, FL, from May 6 to 10.