Polyolefin market encounters product shortages

Polyolefin market encounters…

Despite the lack of some materials in the market, there is no panic or increased purchasing activity from converters. - Manufacturers of finished products only buy raw materials as needed, and in some cases, they use materials that are already in stock and do not plan to make purchases this month - says one of the Polish traders to Chem-Courier.

Converters, on their part, add - The price of LDPE is high this month. Our company is discussing several scenarios. The first is to refrain from purchasing and not produce film, or to buy raw materials and later sell the film with almost zero margin - Additionally, it should be noted that some major converters, who have sufficient financial cushion, are buying polyolefins from traders with delivery in April, believing that the raw material prices may continue to rise.

Due to downtime and force majeure events at various plants, there is a shortage of LDPE with MFI=0.3-3, film HDPE and PP copolymer in the market. Consequently, manufacturers and traders are holding the prices of these materials at a sufficiently high level. 'It cannot be said that there is a deficit of the mentioned materials in the market, however, their limited availability allows for negotiations on higher prices, even above the average market levels - one trader says. Simultaneously, there is a surplus of PP raffia, attributed to the entry of a new player into the market and low purchasing activity. In this case, converters are successfully negotiating price reductions for this material.

According to market players, prices are expected to remain at the same level until end-March. Manufacturers do not plan to lower prices in April. - There will definitely be no general announcement of price reductions next month, however, it is possible that manufacturers will concede during transactions - a Polish trader comments. There is a possibility of a price reduction for PP homo due to surplus and low demand. However, if there is a reduction, it will be minimal - around €20-30/t, Chem-Courier believes.


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