The price of High-Density Polyethylene (HDPE) experienced a significant downward drift in this week of June, ending on 23rd June 2023, in the European market. The reason for this decline was observed due to a lack of demand and an abundance of products in the local market, resulting in a slow downward trajectory. The presence of competitively priced import shipments from international sources also played a role in the decline of prices. Buying activities have decelerated as buyers are now making purchases based on immediate needs and opting to keep inventory levels at a minimum due to weak demand sentiments. Additionally, some buyers are operating at reduced capacities due to limited demand from end users.

Moreover, the falling prices of feedstock Ethylene has further influenced the price of HDPE this week. To protect their profit margins and avoid financial setbacks, manufacturers in the European region are operating their plants at lower capacities. However, the poor demand from end-use industries, such as the construction and agriculture sectors, has decreased prices despite the curtailed production rate.

The costs for Injection grade HDPE FD Hamburg Germany decelerated by 3% this week. Also, the Injection grade FD West Yorkshire United Kingdom (UK) showed a similar price trend with a fall of USD 40/MT from the previous week, which was a drop of 3%. Feedstock Ethylene FD Hamburg prices also drifted down by USD 20/MT in Germany.

American market also witnessed a similar price trend for HDPE this week. The price of HDPE became weaker by 2% for HDPE Film grade FOB Texas on 23rd June 2023 in the USA. The main factor behind the decreasing trend is the decline in the price of feedstock Ethylene, which experienced a 9% decrease in the US market. Furthermore, the USA witnessed sluggish demand for HDPE from the Asian market, thus supporting reasons for reduced prices.

The derivative sector, like packaging and construction, has experienced a significant slowdown over a considerable period in both the European and American markets, with no indications of an imminent recovery. Market participants are not optimistic about any positive changes in the market’s prospects for the near future.

As per ChemAnalyst, based on analysis, it is expected that the price of HDPE will experience a rise in the third quarter of this year. The European region is forecasted to see a surge in the price of HDPE as demand may rise with expected improvement in economic conditions. The US market is also expected to follow a similar upward trend in HDPE prices as the country’s economy may enhance with a declining inflation rate.