The price of FOB Texas grade LDPE film in the United States increased by 0.8%, while the price of CFR Shanghai grade LDPE cling film in China decreased by 1% during the week ending July 26, 2024.
The low-density polyethylene (LDPE) market recently showed variations globally, with a slight price increase in the United States, while the Asian LDPE market experienced a downward trend.
According to market analyst reports, the price increase for the US region was driven by rising raw material costs of ethylene. Another factor in the price reduction was the decrease in crude oil costs, impacting the global market.
Despite these fluctuations, demand in key industries such as construction, packaging, and automotive remained subdued at the end of the month. Supply disruptions and seasonal factors continued to influence regional market dynamics.
As a result, the price of FOB Texas grade LDPE film in the United States increased by 0.8%, while the price of CFR Shanghai grade LDPE cling film in China decreased by 1% during the week ending July 26, 2024.
LDPE rises in the US
In the United States, prices rose slightly due to the increase in the cost of ethylene. However, exports were affected by competition from China, prompting North American producers to consider more flexible pricing strategies to avoid excess inventory.
Energy markets are in recession, with crude oil falling for the third consecutive week on concerns about demand in China. In addition, possible storms could disrupt petrochemical and plastics production, affecting prices in the region soon.
In Asia, the LDPE market was down due to falling oil prices, mainly due to lower demand in China. Although some polyethylene maintenance units are coming back online, increasing supply, there are still concerns about future demand and tensions in the Middle East.
In China, LDPE production has restarted with facilities reopening, but the market remains cautious. Typhoon Gaemi in Fujian adds uncertainty, as heavy rains could disrupt the LDPE supply chain.
ChemAnalyst indicates that negotiations for August cargoes could influence LDPE prices in Asia, with buyers waiting for more clarity on prices. In the US, demand is expected to be subdued and prices could be affected by freight rates due to the peak season.