Polyethylene, Polypropylene, Polystyrene Prices Set for Decline

As the fourth quarter approaches, key commodity resins—polyethylene (PE), polypropylene (PP), and polystyrene (PS)—are expected to retreat from their recent peaks. The market is poised for significant price corrections after a year and a half of robust gains. The primary drivers are an oversupply that now exceeds demand and a gradual decline in feedstock costs.

In contrast, polyvinyl chloride (PVC) and polyethylene terephthalate (PET) are projected to remain flat or rise. PVC’s upward trend is attributed to production interruptions caused by Hurricane Ida and an unrelated outage, while PET benefits from strong demand in big‑box packaging and a scarcity of methylene‑glycol (MEG) feedstock.

These insights come from purchasing specialists at Resin Technology, Inc. (RTi), senior editors at Houston‑based PetroChemWire (PCW), and Michael Greenberg, CEO of the Plastics Exchange.

Polyethylene (PE) Prices: Flat to Downward Momentum

September’s PE pricing was largely flat, as suppliers postponed an announced $0.05/lb increase to October. RTi’s VP of PE markets, Mike Burns, cited a stable supply and a softening demand curve. He projects a potential price drop of $0.03/lb—or even more—over the next month, with a possible 10–15¢/lb correction before year‑end. The same outlook was echoed by PCW’s David Barry and Plastics Exchange CEO Michael Greenberg.

All three experts note that spot PE prices are falling while demand remains muted. Though still above the record highs of earlier this year, PE rates hover at the highest September levels on record. Contract prices have risen $0.41–$0.43/lb since the start of the year, and $0.65–$0.67/lb since May 2020.

Barry points to an upcoming surge in capacity—new SABIC/ExxonMobil and Shell L/LDPE and HDPE facilities, plus Baystar’s HDPE plant—many of which are geared for export. This additional supply is expected to reinforce price pressure into 2023.

Polypropylene (PP) Prices: Downward Trend Continues

PP rates fell $0.03/lb in line with propylene monomer pricing, and further declines are anticipated. RTi’s VP of PP markets, Scott Newell, believes margin expansion is over, warning of continued erosion. Both Newell and Barry foresee a double‑digit price correction before year‑end.

PP remains well‑supplied, with 100% allocation across the market and a noticeable drop in sector demand. Downstream customers are canceling orders, prompting processors to reduce resin purchases and throttle production by 10–20%. Spot‑market deals have appeared $0.10–$0.15/lb below contract prices.

Greenberg notes that while material availability is high, upstream inventories have rebounded, leading producers to hold back new supply to preserve margin gains. PP contract prices have climbed $0.57/lb this year and $0.88/lb since May 2020.

Polystyrene (PS) Prices: Flat to Potentially Lower

PS pricing remained flat in September, despite a $0.02/lb dip in key raw materials. RTi’s VP of PE, PS, and nylon 6 markets, Robin Chesshier, highlighted lower costs for benzene, ethylene, and butadiene, though styrene monomer remained unchanged. October benzene contracts settled $0.32/gal lower, translating to a $0.05/lb reduction in PS manufacturing cost.

Chesshier and PCW’s Barry describe the market as trending toward a buyers’ advantage, citing weak export demand to Asia and an oversupplied domestic market during the typical off‑season. They anticipate a favorable price concession this month, barring unforeseen disruptions.

Polyvinyl Chloride (PVC) Prices: Upward Movement

PVC rates rose $0.02/lb in September, driven by Hurricane Ida’s production outages and an unrelated shutdown. RTi’s VP of PVC, Mark Kallman, and PCW senior editor Donna Todd noted that three of the four major suppliers had announced $0.05/lb hikes for October. Demand remains robust, while supply constraints continue to support the uptick.

Todd highlights that PVC prices increased every month in 2021—except July—amounting to a cumulative $0.245/lb rise. Combined with a $0.16/lb increase in the second quarter of 2020, the total climb stands at $0.405/lb.

Polyethylene Terephthalate (PET) Prices: Flat to Slightly Higher

September PET pricing was largely flat, with marginal adjustments reflecting feedstock and energy cost changes. RTi’s Kallman notes that domestic production has ramped up in response to the push for higher recycled content. Despite supply constraints on MEG and energy costs, PET demand for big‑box packaging remains strong.

Kallman projects that PET prices will stay flat or rise slightly in October and November, even if only by fractions. July imports were record‑high, but he views that month as a peak for imports.