The Week in Chemistry: Strong US resin trading sends producers seeking US$0.08/lb PE contract hike in February, trucker shortages at US ports leave resin containers idle; major chemical players report strong pricing in Q4, still impacted by high costs

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LOS ANGELES , February 11, 2022 () –

US Resins

US spot resin markets saw strong trading activity during the first week of February, keeping spot PE markets steady and sending PP about US$0.01/lb higher. 

After PE contracts failed to achieve the sought-after $0.04/lb price hike for January, producers are seeking an average $0.08/lb increase for February.

Meanwhile, ongoing scarcity of HDPE blow mold and LLDPE film grades lent support for producers seeking price increases. Producers pushed for an average of $0.04/lb hike in February, with outliers seeking $0.05/lb more for HDPE, $0.07/lb on LLDPE.

Spot PP could be impacted by a potential force majeure from the Northeast US. In addition, supply-demand dynamics are tight for the more sought-after PP resins. Polymer-grade propylene contracts are also on the rise, all contributing to some prime PP again surpassing $1.00/lb.

The primary source of this information is Plastics Today.


Major Chemical Players: Q4 Financial Trends

Major chemical producers are releasing fourth-quarter 2021 financial reports showing a strong rebound from the impacts of shutdowns related to the coronavirus pandemic.

Celanese, Eastman, LyondellBasell and Dow all reported higher sales, largely thanks to pricing recovery.

Meanwhile, cost challenges were a consistent theme across the chemical giants. 

Eastman’s CEO noted that the company’s specialty plastics pricing initiatives were a response to high costs for distribution, energy and raw materials.

Celanese reported a similar trend, driving its own prices up 39% to cope with inflation from raw material, energy and logistics costs.

In a separate trend, LyondellBasell and Dow both experienced weakness in plastics-related markets. LyondellBasell noted sliding ethylene and PE prices, while Dow reported a lackluster plastics business.

The primary source of this information is Chemical & Engineering News.


US Resin Ports

US resin ports are having trouble speeding their exports along as imported goods take up space. Traders note that tight availability of trucks makes it impossible to move imports in a timely manner.

Los Angeles and Long Beach ports face a backlog of imports from Asia, sending container ships to other ports.

Meanwhile, trucking shortages mean packaged resins are increasingly filling warehouse space, potentially making warehouses unable to accept new material. 

Anecdotally, one trader saw about 26 containers of resin purchased and packaged in November was not moved throughout December and January.

Trader sentiment is mixed for the year ahead, with some optimistic that logistics conditions will improve, while others see no end to the issue in 2022.

The primary source of this information is S&P Global Platts.

 

 

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