BLOG: HDPE and PP prices outside China continue to fall towards China levels

John Richardson


SINGAPORE (ICIS)–Click here to see the latest blog post on Asian Chemical Connections by John Richardson.

We first warned in April 2021 that global polyethylene (PE) and polypropylene (PP) pricig would eventually fall closer to Chinese levels.

Today’s blog post – where we launch a new weekly high-density PE (HDPE) film grade and polypropylene (PP) injection grades price comparison indices – shows the process has begun

  • Differentials peaked in April 2021 in HDPE and November 2021 in PP. Big falls have occurred since March 2022, as pricing in other countries and regions has converged towards China.

This is because China is undergoing a long-term moderation of economic growth resulting from the Common Prosperity reforms. Since March this year, further downward momentum to China’s economy has been added by the zero-COVID policies

As we expected, container costs are coming down as the post-pandemic cycle out of spending on durable goods is exacerbated by the global inflation crisis. This is making it easier to move oversupply from North and Southeast Asia.

As the charts in the blog show:

  • Average HDPE film grade price premiums in Northwest Europe, Turkey, Southeast Asia, Vietnam, India and Pakistan peaked over China at $354/tonne in April 2021 – an all-time high. In September this year up to 16 September, they were at $136/tonne.

•           PP injection grade price premiums for the same countries and regions over China peaked in November 2021 at $389/tonne, another all-time. The premiums fluctuated in a narrow range before a sharp retreat from March this year onwards. In September 2022, up until 16 September again, the premium was $154/tonne.

Editor’s note: This blog post is an opinion piece. The views expressed are those of the author, and do not necessarily represent those of ICIS.


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