Quick Packaging News

The Polyethylene market kept its active trading pace supported by a small step up in demand. There were relatively heavy offerings of wide spec railcars, while prime material was made available from resellers looking to dish off a portion of their forecasted commitments.  Most PE grades dropped another penny with the exception of LLDPE Film, which managed to hold flat on the week. As expected, contract prices for Linear Low-Density Polyethylene (LLDPE) came in flat at the end of April. The settlement for the month was not delayed like previous months. Not to say the settlement was any less contentious, but in the final days of April, producers made the decision easier by deciding to push the proposed $0.05 increase for April to May. Looking at the supply and demand for the month, both buyers and suppliers have good reasons to press their cases. Buyers push for lower prices was dominated by talk of soft domestic demand, declining production cash costs, enhanced production capa...

POLYETHYLENE MOVED UP IN JANUARY – After three months of flat pricing, linear low density polyethylene (LLDPE), hexene, contract pricing moved up $0.03/lb. Final settlement came after weeks of negotiations between buyers and sellers at odds over the proposed price hikes.  Producers had been pressing for the higher prices arguing that supply has tightened enough to warrant an increase, while buyers insisted demand was not strong enough to justify a price move. In the end, producers won out and have even doubled-down, proposing an additional price hike of between $0.03/lb and $0.05/lb for February. Hard to say if this increase will pass, a lot of capacity in the stretch film market today.   Manufacturers have added lines and are ramping up production and need a home for all this new film.   Distributors have a lot of film on hand, will see how this increase plays out. More information at www.quickpakinc.com      

 July CDI report estimates that the PE grades are down $.03 Nova declared this morning Force Majeure on hexene LLDPE grades due to their hexene monomer supplier having an unplanned outage. The extent and duration of this outage is still not known, but it will tighten up a grade that was already very tight. More info from www.quickpakinc.com

  Domestic production remains stable with some improvement in the supply of LLDPE hexene resin, but some PE grades remain tight, particularly HDPE blow molding and injection molding resin. Inventory levels were a topic of discussion this week as buyers looked for offers in the spot domestic and spot export markets. Indeed, several deals were discussed but little buying activity was reported as prices remain elevated versus imports from other regions such as Asia, but sellers are more open to discussions on trade opportunities versus previous months. Four domestic producers have announced a 5 cpp price increase for domestic contracts sales, effective 1 September for all PE types, in addition to their announced increases for August. More information at www.quickpakinc.com

Buyers reported that resin availability is improving but certain grades such as LLDPE C6 and HDPE.  Blow Molding remain tight. Production in the US continues to improve with reports that most units are up and running as ethylene supply improves due to crackers coming online. However, several plants are not back to full production with reports of two major producers running at about 80% of the pre-freeze levels due to mechanical/feedstock limitations. Several resin producers are indicating inventory levels should improve in May, resolving many of the force majeure events but allocations are likely to continue through June. Price increases for all PE grades of 5-6 cpp have been communicated to the domestic market effective May 1, 2021. Domestic HDPE spot prices (FOB Houston Railcar) were reported in the range of 83-87 cents per pound (cpp) on a notional basis. LLDPE butene resin prices were reported in the 80-84 cpp range (down 1 cpp) and LDPE was reported flat with prices in the ran...