Wild, Wild West – US PE Market Opaqueness High, Resin Maker Alignment With Customers Curbs Long-Term Risk

Daily Chemical Reaction

Wild, Wild West – US PE Market Opaqueness High, Resin Maker Alignment With Customers Curbs Long-Term Risk

Key Points:

• Two significant observations from Pack Expo are that price visibility in the US polyethylene (PE) market is low, and the importance of plastic producer alignment with customers is rising.
• US contract reference PE prices surged relative to spot levels in 2021-2022 but still reflect historically high premiums – net transaction prices are mostly in-between, but visibility is low.
• We discuss the rising importance of resin supplier alignment with customers as sustainability efforts shift product mix – producer efforts, such as at Dow Pack Studios, are increasing in value.
• We highlight further strength in crude oil values, progress updates on an e-cracker project in Europe, and the Sept. WASDE report, crop prices, and fertilizer costs as a % of farm revenue.
• The Pack Expo event concludes today, and the C-MACC team will reunite at the CMA World Chemical Forum tomorrow. Graham Copley’s birthday is today, so take time to wish him well.

See PDF below for all charts, tables and diagrams