HOUSTON (ICIS)--US September polyethylene (PE) contracts have settled up 5 cents/lb ($110/tonne), sources said on Thursday.
The increase brings September high-density polyethylene (HDPE) blow-moulding contracts to 73-75 cents/lb, as assessed by ICIS.
The increase marks only the third PE monthly hike this year. Contracts fell in the first two months, rose in March and April and then rolled over in May through August.
Year to date, the PE monthly settlement has increased by a cumulative 7-8 cents/lb.
The prime mover behind the latest rise, feedstock spot ethylene, has jumped 46% since early July on tight supply from outages and turnarounds. Some PE plants have also seen unplanned outages and turnarounds, as at an ExxonMobil unit this week.
Industry data showed a big buying spree in August, with the second highest PE sales total this year, as purchasing escalated to avoid the September hike. PE sales also rose in February and March before scheduled increases the following month.
US PE inventory fell almost 7% in August from July as buyers stocked up on resin ahead of the September increase, according to industry data.
For October, a few 4 cent/lb increases have been nominated but sources say the outlook for those proposals is unclear at this point.
Major US PE producers include Chevron Phillips, Dow, DuPont, ExxonMobil, Formosa Plastics USA, Ineos Olefins and Polymers, LyondellBasell, Nova, Total USA and Westlake Petrochemicals.Milk bottles are made of PE (Photo: OJO Images/REX/Shutterstock)?xml:namespace>