PE, PS, PET prices up; PP down; PVC flat

Market forces sent North American commodity resin prices in different directions in September, with polyethylene, solid polystyrene and PET bottle resin prices up, regional polypropylene prices down and PVC prices flat.

All grades of PE moved up by an average of 3 cents per pound, according to market sources contacted by Plastics News. Market analyst David Barry with PetroChem Wire in Houston said that ethane feedstock was the big driver in the September PE price hike.

Ethane-based ethylene cash costs averaged more than 21 cents per pound in September, which Barry said was the highest level since January 2012. Those costs were running 10-11 cents for the first five months of the year.

Barry added that he believes that PE makers were able to export more in September to keep the market balanced. "The reports I'm getting are that the Gulf Coast and East Coast warehouses are busy," he said.

The September PE hike followed a chaotic pricing month in August, which ended with 3-cent-per-pound reductions for most grades of low and linear low density PE and for film and other flexible grades of high density PE.

Prior to the August declines, regional HDPE and LDPE prices had been flat for four consecutive months. LLDPE prices had been flat for two straight months after sliding 3 cents in May.

Backed by new production capacity, export sales of PE had fueled U.S. and Canadian PE growth in the first eight months of 2018, according to the American Chemistry Council. Exports of LLDPE in particular had exploded, growing almost 90 percent vs. the same period in 2017.

LLDPE exports, combined with domestic demand growth of almost 5 percent, lifted total regional LLDPE market growth to almost 23 percent for the period.

HDPE exports from the region were up an impressive 30 percent for the seven months. Those levels and domestic growth of almost 8 percent created eight-month HDPE growth of almost 12 percent. Growth in LDPE exports was more modest at 9 percent. That combined with domestic sales growth of almost 2 percent produced seven-month LDPE growth of almost 4 percent.

North American PET bottle resin prices surged up an average of 6 cents per pound in September after a 2-cent hike in August. Market watchers cited tight supplies of purified terephthalic acid and other raw materials as reasons for the increase. The 2-cent August hike had canceled out a 2-cent drop that hit the market in July.

Regional solid PS prices bumped up an average of 2 cents per pound in September after being flat in August. The September hike was sparked by a price increase for benzene feedstock, which was up 10 cents to $2.98 per gallon.

North American solid PS sales have struggled so far in 2018, dropping more than 4 percent through August. Exports have provided a bright spot, growing more than 16 percent and somewhat reducing the impact of a 5 percent drop in domestic sales.

PP was the only major commodity resin to see lower prices in September. Average selling prices for the material were down 1 cent per pound, giving back half of a 2-cent hike that the market had seen in August.

Resin prices for PP in September again followed the path of propylene monomer feedstock. Prices had been flat in July after surging a combined 15 cents in May-June.

North American PP sales were down almost 1 percent through August. Flat domestic sales were made worse by a decline of almost 35 percent in export sales.

Some domestic PP end markets have fared well in spite of the overall decline. Sales of PP into oriented film were up almost 14 percent for the eight-month period. Sales of the materials into injection molded caps and closures grew more than 7 percent.

Regional solid PVC prices were flat for the fifth consecutive month in August, although market sources said that increases of as much as 2 cents per pound could take hold in October. A small Oct. 9 fire at a Westlake Chemical plant making PVC feedstock VCM in Plaquemine, La., isn't expected to have much impact on the PVC resin market.

U.S./Canadian PVC sales were strong through August, climbing 5.4 percent vs. the year-ago period. Domestic growth of just under 2 percent was bolstered by a jump of 13.5 percent in export sales. Among end markets, rigid pipe and tubing showed eight-month growth of almost 2.5 percent. That segment accounted for more than 46 percent of all domestic PVC sales during that period.

At the macro-feedstock level, West Texas Intermediate crude oil prices began September at $69 per barrel but had climbed to $75 by the end of the month. Regional prices for natural gas rose from $2.85 per million British thermal units to $3.05 in the same comparison.