US Feb PE rises 5 cents/lb, first hike in 5 months

Lane Kelley

24-Feb-2017

HOUSTON (ICIS)–US polyethylene (PE) February contracts rose 5 cents/lb ($22/tonne) in February, sources said on Friday, marking the first contract increase for that polymer in five months.

The February hike followed rising PE prices globally, from China and throughout Asia to Europe and the Middle East and throughout Latin America.

The increase raised high-density PE (HDPE) blow moulding prices to 74-76 cents/lb from 69-71 previously.

Producers want to raise contract prices again next month, with three nominations issued separately for a 6 cent/lb increase in March.

Export prices, sometimes a leading indicator for domestic contracts, rose again this week, however slightly. One buyer attributed the lift to expectations for at least a partial increase in March.

That buyer predicted the market will accept half of the proposed March hike next month and the other half – 3 cents/lb – in April.

Another buyer expected all of the March increase to stick, but a longtime PE veteran said the chances for that hike are by no means assured.

“Everybody was pre-buying in January for February,” that source said. “That’s why [the March PE increase] is not going to go through.”

Major producers include Chevron Phillips Chemical, Dow Chemical, DuPont, ExxonMobil, Formosa Plastics USA, INEOS Olefins and Polymers, LyondellBasell, Total USA and Westlake.

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