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Wavering Downstream Demand Oscillates Global HDPE Prices

Wavering Downstream Demand Oscillates Global HDPE Prices

Wavering Downstream Demand Oscillates Global HDPE Prices

  • 28-Nov-2022 3:42 PM
  • Journalist: Jacob Kutchner

High-Density Polyethylene (HDPE) prices fluctuate in the global market, influenced by crude oil prices and disruption in supply/demand fundamentals. In Germany, spot prices have moved higher with bullish market fundamentals. In addition, acceleration in trading also pushed HDPE prices and the benchmark futures higher this week. With the week ending on 25th November 2022, the price of HDPE in Germany slipped to USD 1570/tonne (Raffia Grade) FD Hamburg.

In terms of the feedstock market, Ethylene prices faced a Southward trend, but accelerating demand from the downstream plastic and food packaging industry helped the prices to gain support. In the United Kingdom, trading sentiments showed cautious improvement with firmer HDPE future benchmarks and the boost in HDPE demand from the downstream industry. The regional's trading increased with the utilization of existing inventories. Exports from Belgium to other European regions are traded moderately per the end user's requirement. The profit margin of HDPE producers started to follow an upward trajectory.

In the USA, slowed demand, adequate supplies, lower feedstock cost, and regional economic uncertainty helped the HDPE prices decline further. As per the market players in the US, there is no sign of a pickup in demand and low purchasing sentiments from the downstream plastic and food packaging industries. Export demand remained soft, and traders had high inventories and uncertainty about price direction for forthcoming weeks. With the week ending on 25th November 2022, the cost of HDPE in the US declined to USD 1190/tonne (Film Grade) FOB Texas.

As per ChemAnalyst, the price of HDPE will remain influenced by crude oil prices, level of inventories, and production cutbacks. In the European market, HDPE prices will increase with low stocks from the downstream plastic market. However, declining crude and Natural Gas prices in the US will still prevail, and bearish demand can lower the HDPE prices. Rising energy costs and utility bills in Europe and the United States can disrupt the Polyolefin market.

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