North American commodity resins continued their early-year price surge in March, with regional prices for polyethylene, polypropylene, polystyrene and PVC all increasing.
The 3-cent PE price hike came about after some back-and-forth between suppliers and processors. Initial reports indicated that the full 6 cents that PE makers had been seeking would take hold. Then it appeared for a brief time that market prices would roll over flat vs. February.
Producers and buyers finally split the difference, moving prices up 3 cents and announcing plans to try for the other 3 cents in April.
A combination of events allowed the 3-cent hike to stick, according to Mike Burns, a market analyst with the Resin Technology Inc. consulting firm in Fort Worth, Texas.
"There were low prices in November and high exports in December," he said. "Then there was restocking in January. This all lined up to reduce [PE] supply."
Supply also was limited by production issues experienced by several resin makers, including Chevron Phillips Chemical Co. CP Chem on March 13 declared force majeure on high density PE because of a power outage at its plant in Orange, Texas.
The March hike was the second consecutive monthly increase for regional PE prices, following a 5-cent January hike. Prices had been flat in January, after falling an average of 2 cents per pound in December. They were up a net of 4 cents for full-year 2016.
U.S./Canadian sales of low and linear low density PE came charging out of the gate in the first two months of 2017, with HDPE trailing behind. Two-month sales of LDPE were up 7 percent, according to the American Chemistry Council, with regional LLDPE sales through February up almost 7 percent. HDPE in the region only managed two-month sales growth of less than 1 percent.