NOVA Chemicals, one of the world’s largest producers of polyolefins, announced an increase in prices of polyethylene (PE) by 4 cents per pound (USD88 per tonne) from September 1 of this year or as contracts permit, ICIS reports citing a letter to the company to customers.
According to the letter, 4 cents per pound set for September is in addition to the NOVA announced earlier increase of 3 cents per pound (USD66 per tonne) in August.
Contracted PE prices in the United States have been declining for the past two months in a row. Lower contract prices and higher export volumes led to lower margins for polyethylene producers. Buyers may resist the resumption of rising prices, as raw material costs declined for most of the year, while stocks remain in abundance.
PE supplies are growing as the US is in the process of massively increasing PE production, due to cheaper gas-based raw materials.
The industry added about 3.5 million tons per year of new capacity in 2017 and plans to add a similar volume in 2019. Further capacity expansion is planned for the 2020s.
In July, the contract prices for butene-based LDL film were 49-55 cents per pound (USD 1,078-1,210 per tonne), HDPE for blow molding was 52-56 cents per pound (USD1 144-1,232 per tonne), LDPE 56 -60 cents per pound (USD1,232 – 1,320 per ton).
According to the ICIS-MRC Price Review, in Russia, purchasing activity in the local market is low, but demand is stable. The excess supply on the LDPE market is not so serious due to the long downtime of the two manufacturers. In the IPA segment, excess supply remains, but it no longer puts pressure on prices. Last week, both price increases and declines were recorded. Most significantly cheaper LDL C4.
The main producers of polyethylene in the United States are Chevron Phillips Chemical (CP Chem), DowDuPont, LyondellBasell, ExxonMobil, Formosa, INEOS, Total Petrochemicals and Westlake.
Nova Chemical is the largest global company producing polyethylene, styrene polymers, monomers, and many other related products.