The mood in spot resin trading last week was . . . noisy. At the PlasticsExchange trading desk, the first full week of April was the busiest week in almost a full year, as the market was still reeling from the winter storm in Houston. Demand from processors and retailers remained strong at the start of the second quarter, but the general lack of rapid supply also continued.

Spot Prime resin prices were little changed over the past week: Polyethylene (PE) held steady at 2022 highs, while polypropylene (PP) prices were down one cent from set season highs a few weeks ago, writes PlasticsExchange in its market update.

Producers assured their price increases in March. The PE added $0.04/lb and the PP trailed monomer contracts up a solid dime. Producers are determined to maintain high margins, according to the PlasticsExchange, with another round of price increases scheduled for April. Although upstream PE inventories are swelling to record highs, much of it is being packaged in warehouses and destined for export. With continued equipment and ocean freight constraints, growers are holding off additional or unreasonably priced export offers. Official monthly resin production data in the United States has been delayed, but PE producers say they have cut production significantly, which could create additional supply issues.

PE trading and volumes rebounded as April got into full swing. Healthy demand and tight availability kept commodity prices stable at generally high levels. High-density (HD) PE has taken over as the main driver in the PlasticsExchange market, with relatively high volumes of injection and blow molding grades changing hands, both domestic and exported to Mexico and India. Europe. Low-density (LD) PE film grades also saw rapid sales, with hard-to-find replacement materials. Linear Low Density (LLD) PE injection grades also grew well, and although there was demand for LDPE injection, supplies were scarce and carried a significant premium, limiting transactions.

Despite the substantial volume movement, export offers remained limited in early April, a time when they could otherwise be plentiful, writes PlasticsExchange. Producers secured their March increase of $0.04/lb – the first contract price hike since July 2021. With limited export opportunities due to logistical constraints, producers appear to have slowed down reactors to prevent their excess inventory does not become too heavy. Perhaps tight domestic availability and bullish market momentum could propel PE prices even higher, as an additional $0.06/lb increase is proposed on average for April.

In the PP market, demand remained strong despite tight supply and volatile monomer costs. Volumes completed at the PlasticsExchange reached their highest level in more than a month and were well distributed between PP homopolymer, copolymer and random copolymer grades. PP Prime prices have lost a dime on weaker PGP monomer, and are still within striking distance of 2022 highs, though still a far cry from the previous year’s levels, PlasticsExchange reports.

The modest drop in PP last week came as PGP commodity and crude oil prices softened, and a steady stream of mostly off-grade railcars bombarded the market, while imported Prime was rare. Prime domestic wagons were available on a monomer plus margin basis, but most cash buyers like to trade at a firm, solid price. Although PP prices were down a dime last week, overall availability remains challenging with a pair of force majeure statements in place, one in Louisiana and one in California. After the $0.10/lb cost increase in March PP contracts, further efforts to improve margins have been dispersed, so April prices will likely follow cost developments again. monomers.

Read the full market update, including news on PGP prices and energy futures, on the PlasticsExchange website.

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