Skip to main content
Sister Publication Links
  • Sustainable Plastics
  • Rubber News
Subscribe
  • Sign Up Free
  • Login
  • Subscribe
  • News
    • Processor News
    • Suppliers
    • More News
    • Digital Edition
    • End Markets
    • Special Reports
    • Newsletters
    • Videos
    • Injection Molding
    • Blow Molding
    • Film & Sheet
    • Pipe/Profile/Tubing
    • Rotomolding
    • Thermoforming
    • Recycling
    • Machinery
    • Materials
    • Molds/Tooling
    • Product news
    • Design
    • K Show
    • Mergers & Acquisitions
    • Sustainability
    • Public Policy
    • Material Insights Videos
    • Numbers that Matter
    • Automotive
    • Packaging
    • Medical
    • Consumer Products
    • Construction
    • Processor of the Year
    • Best Places to Work
      • 2023 winners
    • Women Breaking the Mold
    • Rising Stars
    • Diversity
    • Most Interesting Social Media Accounts in Plastics
  • Opinion
    • The Plastics Blog
    • Kickstart
    • One Good Resin
    • Pellets and Politics
    • All Things Data
    • Viewpoint
    • From Pillar to Post
    • Perspective
    • Mailbag
    • Fake Plastic Trees
  • Shop Floor
    • Blending
    • Compounding
    • Drying
    • Injection Molding
    • Purging
    • Robotics
    • Size Reduction
    • Structural Foam
    • Tooling
    • Training
  • Events
    • K Show Livestream
    • Plastics News Events
    • Industry Events
    • Injection Molding & Design Expo
    • Livestreams/Webinars
    • Editorial Livestreams
    • Ask the Expert
    • Plastics News Events Library
    • Processor of the Year submissions
    • Plastics News Executive Forum
    • Injection Molding & Design Expo
    • Plastics News Caps & Closures
    • Women Breaking the Mold Networking Forum
    • Plastics in Automotive
    • Bioplastics Live
    • PN Live: Mergers and Acquisitions
    • Polymer Points Live
    • Numbers that Matter Live
    • Plastics in Politics Live
    • Sustainable Plastics Live
    • Plastics Caps & Closures Library
    • Plastics in Healthcare Library
    • Women Breaking the Mold Networking Forum Library
  • Rankings & Data
    • Injection Molders
    • Blow Molders
    • Film Sheet
    • Thermoformers
    • Pipe Profile Tubing
    • Rotomolders
    • Mold/Toolmakers
    • LSR Processors
    • Recyclers
    • Compounders - List
    • Association - List
    • Plastic Lumber - List
    • All
  • Directory
  • Resin Prices
    • Resin Prices Overview
    • Commodity Thermoplastics
    • High Temperature Thermoplastics
    • Engineering Thermoplastics
    • Recycled Plastics
    • Thermosets
  • Custom
    • Sponsored Content
    • LS Mtron Sponsored Content
    • Conair Sponsored Content
    • KraussMaffei Sponsored Content
    • ENGEL Sponsored Content
    • White Papers
    • Classifieds
    • Place an Ad
    • Sign up for Early Classified
MENU
Breadcrumb
  1. Home
  2. News
April 12, 1999 02:00 AM

SECOND POLYETHYLENE PRICE HIKE TAKES HOLD

Frank Esposito
Senior Staff Reporter
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    Polyethylene prices are continuing their early-year surge, with price increases of up to 5 cents per pound going through to most buyers since March 1.

    All grades of high density PE are up an average of 3 cents, while all grades of low density and linear low density PE have climbed an average of 5 cents. These changes are reflected in this week's Plastics News resin pricing chart.

    HDPE prices have risen an average of 6 cents so far in 1999, while LDPE and LLDPE prices are up an average of 8 cents. Major PE makers — including Dow Chemical Co. of Midland, Mich.; Mobil Chemical Co. of Fairfax, Va.; Exxon Chemical Co. of Houston; Fina Oil and Chemical Co. of Dallas; Union Carbide Corp. of Danbury, Conn.; Phillips Petroleum Co., of Bartlesville, Okla.; and Solvay Polymers Inc. of Houston — are attempting to keep this momentum going by announcing 5 cent increases set for May 1.

    The announcement of the May 1 increase seemed to help the March 1 increase take hold, according to some buyers. Similar tactics failed in 1998 as prices dropped an average of 12 cents.

    ``That was the slam dunk,'' a California-based PE buyer said of the announced May 1 increase.

    Other factors driving the increase included strong PE demand, tight ethylene supplies and low processor inventories.

    ``Polyethylene today is extremely tight,'' one PE executive said.

    ``Market sentiment has shifted," he said. A lot of the decline we saw last year was based on psychology and not on supply and demand.''

    January U.S. LLDPE sales soared 10.5 percent over last year's total for the same month, while producers reduced their output by almost 2 percent, according to the Society of the Plastics Industry Inc. in Washington.

    HDPE sales jumped 5.5 percent in the same comparison, with production up more than 2 percent. LDPE sales are down 3 percent, with production off almost 7 percent.

    Ethylene supplies are estimated to be in the six-to-seven-day range in a market where anything under 10 days is considered tight. This tightness has been caused by planned as well as unplanned shutdowns at ethylene suppliers, such as Equistar Chemicals LP, BP Amoco Chemicals, DuPont Co. and Shell Chemical Co.

    Several buyers said the outages may have been initiated by PE makers to spark price increases.

    ``I don't know if there's a true shortage of ethylene or polyethylene,'' an Ohio-based PE buyer said. ``We haven't had any cases where we couldn't get the resin we need.''

    ``This is an artificial shortage,'' a New York-based PE buyer said. ``Companies have cut back on production because they know when new capacity comes on later this year they're going to be in trouble.''

    Capacity additions that started in late 1998 will have added 1.25 billion pounds of swing HDPE/LLDPE capacity, 1 billion pounds of HDPE capacity and 500 million pounds of LLDPE capacity by the end of this year. Included in this wave are expansions by Dow, Equistar, Exxon, Fina, Mobil and Westlake Polymers of Houston.

    In addition, many PE processors had kept their inventories lower than normal in 1998 to capitalize on monthly price reductions.

    ``If you think your next rail car [of polyethylene] is going to be cheaper, you're not going to add to your inventory,'' another PE executive said.

    With demand ramping up in 1999, some processors have had to scramble to obtain material. That could be good news for PE makers.

    ``At the end of [1998] we were in a down cycle, but now you might want to get an extra rail car to beat the next increase,'' a Chicago-based PE buyer said. ``If everyone does that, it'll increase demand.''

    But a number of PE buyers believe the early-year PE price run-ups will be short-lived.

    ``[Prices] will reach the point where buyers reach their normal inventory levels and then will drop off,'' the Chicago buyer added. ``There's enough capacity coming on this summer that prices will start to deteriorate.''

    RECOMMENDED FOR YOU
    Greenback sets goal for 300 plants to recycle laminated packaging within 20 years
    Letter
    to the
    Editor

    Do you have an opinion about this story? Do you have some thoughts you'd like to share with our readers? Plastics News would love to hear from you. Email your letter to Editor at [email protected]

    Most Popular
    1
    Kickstart: Paper bags, 'paper' bottles
    2
    Resin Prices
    3
    Treaty talks end with plans for a draft agreement, but hurdles remain
    4
    PP recycler PureCycle sees Ohio plant as springboard for growth
    5
    WL Plastics building $40M MDPE pipe plant in Texas
    SIGN UP FOR OUR FREE NEWSLETTERS
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    Get our newsletters

    Staying current is easy with Plastics News delivered straight to your inbox, free of charge.

    Subscribe today

    Subscribe to Plastics News

    Subscribe now
    Connect with Us
    • LinkedIn
    • Facebook
    • Twitter
    • Instagram

    Plastics News covers the business of the global plastics industry. We report news, gather data and deliver timely information that provides our readers with a competitive advantage.

    Contact Us

    1155 Gratiot Avenue
    Detroit MI 48207-2997

    Customer Service:
    877-320-1723

    Resources
    • About
    • Staff
    • Editorial Calendar
    • Media Kit
    • Data Store
    • Digital Edition
    • Custom Content
    • People
    • Contact
    • Careers
    • Sitemap
    Related Crain Publications
    • Sustainable Plastics
    • Rubber News
    • Tire Business
    • Urethanes Technology
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • News
      • Processor News
        • Injection Molding
        • Blow Molding
        • Film & Sheet
        • Pipe/Profile/Tubing
        • Rotomolding
        • Thermoforming
        • Recycling
      • Suppliers
        • Machinery
        • Materials
        • Molds/Tooling
        • Product news
        • Design
      • More News
        • K Show
        • Mergers & Acquisitions
        • Sustainability
        • Public Policy
        • Material Insights Videos
        • Numbers that Matter
      • Digital Edition
      • End Markets
        • Automotive
        • Packaging
        • Medical
        • Consumer Products
        • Construction
      • Special Reports
        • Processor of the Year
        • Best Places to Work
          • 2023 winners
        • Women Breaking the Mold
        • Rising Stars
        • Diversity
        • Most Interesting Social Media Accounts in Plastics
      • Newsletters
      • Videos
    • Opinion
      • The Plastics Blog
      • Kickstart
      • One Good Resin
      • Pellets and Politics
      • All Things Data
      • Viewpoint
      • From Pillar to Post
      • Perspective
      • Mailbag
      • Fake Plastic Trees
    • Shop Floor
      • Blending
      • Compounding
      • Drying
      • Injection Molding
      • Purging
      • Robotics
      • Size Reduction
      • Structural Foam
      • Tooling
      • Training
    • Events
      • K Show Livestream
      • Plastics News Events
        • Plastics News Executive Forum
        • Injection Molding & Design Expo
        • Plastics News Caps & Closures
        • Women Breaking the Mold Networking Forum
        • Plastics in Automotive
      • Industry Events
      • Injection Molding & Design Expo
      • Livestreams/Webinars
        • Bioplastics Live
        • PN Live: Mergers and Acquisitions
      • Editorial Livestreams
        • Polymer Points Live
        • Numbers that Matter Live
        • Plastics in Politics Live
        • Sustainable Plastics Live
      • Ask the Expert
      • Plastics News Events Library
        • Plastics Caps & Closures Library
        • Plastics in Healthcare Library
        • Women Breaking the Mold Networking Forum Library
      • Processor of the Year submissions
    • Rankings & Data
      • Injection Molders
      • Blow Molders
      • Film Sheet
      • Thermoformers
      • Pipe Profile Tubing
      • Rotomolders
      • Mold/Toolmakers
      • LSR Processors
      • Recyclers
      • Compounders - List
      • Association - List
      • Plastic Lumber - List
      • All
    • Directory
    • Resin Prices
      • Resin Prices Overview
      • Commodity Thermoplastics
      • High Temperature Thermoplastics
      • Engineering Thermoplastics
      • Recycled Plastics
      • Thermosets
    • Custom
      • Sponsored Content
      • LS Mtron Sponsored Content
      • Conair Sponsored Content
      • KraussMaffei Sponsored Content
      • ENGEL Sponsored Content
      • White Papers
      • Classifieds
        • Place an Ad
        • Sign up for Early Classified