Published 1/21/2025

Prices Generally Trending Upward for the Five Commodity Resins

Scheduled and unscheduled production disruptions, and projected higher feedstock costs could be key factors.

Contributing Editor, Plastics Technology Magazine

PE Prices Flat to Up

Polyethylene (PE) prices rolled over in December and suppliers were out with January increases of 5 to 7¢/lb, of which partial implementation was possible within the first couple of months, according to David Barry, PCW’s associate director for PE, PP and PS; as well as TPE’s Greenberg; Mike Burns of Plastic Resin Market Advisors; and Kevin Mekaru, RTi’s senior business leader of commodity plastics.

Still, nonmarket discounts were widely reported by buyers during end-of-year contract negotiations, according to PCW’s Barry. He noted that inventories appeared plentiful, and buyers said suppliers would have a hard time implementing a price hike in January, particularly if the December industry data showed another inventory build. Pointing out that PE suppliers officially only gave back 3¢/lb out of the 2024 price hikes of 13¢/lb, RTi’s Mekaru ventured there was potential for implementation of a 3¢/lb increase in January with a rollover this month.

Prices of the five major commodity resins are projected higher despite slowed domestic demand and the buyers’ market experienced at the end of 2024.

Citing American Chemistry Council supply/demand data for November, TPE’s Greenberg noted that domestic PE sales declined for the fourth straight month — down 5.6% compared to the 12-month average — to reach their lowest level since November 2023. Meanwhile, PE suppliers produced a record amount of resin, primarily driven by strong export demand. “Exports soared to their highest ever and, for the first time, actually exceeded total domestic sales,” Greenberg says. Between 45-51% of North American PE production goes to exports.

According to Plastic Resin Advisors’ Burns, if suppliers were to maintain November’s high production rates, 2025 resin production could potentially increase by 7% or 5 billion lbs. “Allowing a generous 3% domestic demand, suppliers would need to export an additional 5% of production to maintain a balanced inventory,” Burns says.

PP Prices Down, Then Up?

Polypropylene (PP) prices dropped by 2.5¢/lb in December, in step with propylene monomers, but were expected to have bottomed out going into January, with a more than likely upward trajectory going forward, according to PCW’s Barry, Spartan Polymers’ Newell, TPE’s Greenberg and Paul Pavlov, RTi’s VP of PP and PVC. Spot monomer prices were firming up and, as TPE’s Greenberg reported, prices for propylene and PP would be higher within the year’s first quarter. RTi’s Pavlov ventured a potential 3 to 5¢/lb increase was possible.

Source: Borealis

PCW’s Barry emphasized that propylene supply factors, rather than demand, were the driving force, with industry reports of a heavier than typical turnaround season for refineries and steam crackers. These sources all noted that demand was particularly slower in the fourth quarter of 2024, with PP plant operating rates having been reduced to below 70%. Newell said the industry sentiment on PP demand going into 2025 was bearish. Barry added that a global oversupply of PP was another factor with China now selling lower cost PP in South America and buying interest in exports was low at year’s end. “Most North American PP producers lacked competitive feedstock economics to match available pricing from Asia,” Barry says, “and traders were focused on exporting PE.”

All sources ventured that demand from sectors such as consumer goods and automotive could well pick up but more so in the second quarter. They also noted that processors continued to work through resin stocks they had built up through much of 2024’s second half, which were largely as a cushion to withstand hurricane season production disruptions.

PS Prices Flat for Now

Polystyrene (PS) prices appeared to have largely rolled over at the end of the fourth quarter and could continue that way in the first couple of months of 2025, according to PCW’s Barry and RTi’s Pavlov. Still, Pavlov noted that there were many nonmarket discounts in the 1-to-2¢/lb range at the end of last year. Those were in addition to last October’s 3¢/lb drop, following six months of flat pricing.

Both sources noted that PS demand continued to be low, with plant operating rates in the 50% range by year’s end. Barry characterized spot PS resin availability as merely adequate as suppliers dropped operating rates to match firm orders. By late December, he reported that the implied styrene cost based on a spot formula of 30% ethylene/70% benzene was flat versus the previous month. Both sources saw a potential upward pricing trajectory coming from an uptick in benzene or styrene monomer prices due to weather-related disruptions.

PVC Prices Up?

PVC prices were expected to move up 1 to 2¢/lb in January, as most suppliers were out with increases of 5¢/lb, with February prices to roll over from January, according to RTi’s Pavlov. This, after having dropped 3¢/lb in the fourth quarter of 2024, driven by both slowed domestic and exports sales, along with significant supplier inventory buildup. Plant operating rates were in the mid-70s percentage-wise, and there was concern about potential impact of the new U.S. administration’s possible tariffs on PVC imports.

PET Prices Flat to Up

PET prices were expected to be flat to up within the January-February time frame, after dropping 5¢/lb in the fourth quarter of 2024. This is based on raw material formulation costs, which were expected to be a bit higher due to both scheduled turnarounds and the potential of weather-related disruptions, according to RTi’s Mekaru. Demand was softer and there was ample supply resulting from domestic production and well-priced imports. However, here too there was concern in the industry of how the new U.S. administration’s proposed tariffs on imports would impact PET’s supply/demand balance and overall pricing.