Regional prices for all grades of polyethylene and suspension PVC were flat in March. PE prices now have been flat for three consecutive months after buyers were able to fend off a 6-cent increase that had been announced by suppliers for Jan. 1. Some market watchers thought that half of the 6 cents might stick in February, but prices rolled over to March instead and stayed flat.
PE prices had slid down 3 cents in both November and December. Market watchers cited lower oil prices and lower global demand, especially from packaging. Oil prices affect global resin markets, even though most North American PE is made from natural gas.
U.S. and Canadian high and linear low density PE sales reported major growth in 2018, resulting from larger amounts of new capacity being sold into the export markets as well as domestic sales that have reported strong growth.
HDPE sales in the region were up 12 percent for the year, according to ACC, with domestic growth of more than 5 percent amplified by export sales growth of more than 42 percent. In LLDPE, 11-month sales soared more than 24 percent, with domestic sales up almost 5 percent and export sales almost doubling.
Regional PVC prices were flat in March after moving up an average of 2 cents per pound in February. That 2-cent hike was the result of higher prices in the export market, a market source told Plastics News. Higher demand from the construction market and low resin inventories also played a role.
The February hike ended a streak of nine consecutive months of flat pricing for North American PVC. Market prices had not moved since April 2018, with supply and demand being closely balanced. Regional PVC prices were up a net of 3 cents in 2018.
PVC-related operating profit for 2018 jumped more than 40 percent to $913 million for Houston-based Westlake Chemical Corp. Earlier this year, company officials said that was mainly because of higher sales prices and volumes for caustic soda, lower ethylene costs, improved operating rates and lower costs associated with planned turnarounds and unplanned outages, as compared to 2017.
U.S. and Canadian PVC sales were solid in 2018, climbing 3 percent vs. the previous year, according to ACC. Domestic PVC sales were flat, but the overall growth rate was bolstered by a jump of 10 percent in export sales.
At the macro-feedstock level, West Texas Intermediate crude oil prices began March at $56.25 per barrel but jumped to $61.50 by the end of the month, a gain of just over 9 percent.
Regional prices for natural gas moved in the other direction, declining from $2.85 per million British thermal units to $2.70 in the same comparison, for a decline of more than 5 percent.