North American polypropylene resin prices have continued their early-year surge, increasing by 4 cents per pound in March.
The increase was connected to tightness in supplies of propylene monomer feedstock, which caused prices for that material to rise as well. Regional PP resin prices now are up 20.5 cents per pound since Jan. 1.
But market sources told Plastics News that the March PP hike might be the last for a while. "March will be the peak," said Scott Newell, a market analyst with Resin Technology Inc. in Fort Worth, Texas. "I see a large correction coming. We can already see the signals that this thing is starting to turn around.
"Propylene monomer supply is heavily incentivized from all production streams [and] seasonal outages are wrapping up," he added. "As monomer supply comes back, demand needs to come back. Prices must come down."
A major regional PP buyer agreed, saying that "it appears all resins have peaked and the downward slide is next."
North American PP sales were up almost 1 percent in the first two months of 2017, according to the American Chemistry Council. Domestic sales were down almost 1 percent in that period, but export sales more than doubled. Regional PP sales grew 0.4 percent in full-year 2016.