Optimism for Upcoming Seasonal Demand for LLDPE and LDPE Induces Stocking Activities in Europe

Optimism for Upcoming Seasonal Demand for LLDPE and LDPE Induces Stocking Activities in Europe

Optimism for Upcoming Seasonal Demand for LLDPE and LDPE Induces Stocking Activities in Europe

  • 14-Mar-2023 7:10 PM
  • Journalist: Shiba Teramoto

Polyethylene’s (LLDPE and LDPE) prices started to increase during March 2023 in European markets. The market situation for the European Polyethylene market during the start of 2023 was clouded by various issues. Initially, there was little hope for the beginning of 2023 because of worries that energy could reappear as a key pressure if temperatures drop. However, the temperatures in Europe were unusually warm, which led to easing energy costs since the beginning of this year. The relatively low energy costs in the European market brought down the operation cost of LLDPE and LDPE, leading to a declining price trend of Polyethylene in Europe. However, the downward pressure on LLDPE and LDPE demand was relieved a little during the start of the year as the inflation rates in Europe steadily declined throughout the months. Even though European buying sentiments improved, they could not drive up the price of LLDPE and LDPE.

Russia stopped meeting the energy needs of Europe as the EU launched sanctions against Russian imports. 16% of the LNG that is supplied to Europe came from Russia before these sanctions as the consumer requirement is rising due to the upcoming summers, along with steadily increasing Natural Gas prices, which is the major factor driving up the cost of LLDPE and LDPE during March 2023. Despite Polyethylene demand increasing only slightly in Europe, the cost of upstream Ethylene increased steadily during March owing to restocking activities in the EU and abetting LLDPE and LDPE price hikes during this month.

According to ChemAnalyst, prices of LLDPE and LDPE are likely to rise throughout the rest of the month despite moderate demand from the downstream industries. Upstream Ethylene prices in the European region are expected to increase, assisting the rising price of LLDPE and LDPE in several European markets. The upcoming summer will mostly improve the demand scenario as the requirements for packaged bottles, and other packaging materials will improve, driving up the prices of LLDPE and LDPE.


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