In early February, both the European and U.S. LDPE markets saw price hikes driven by tight supply conditions, rising feedstock costs, and production disruptions. Forecasts suggest that the upward trend in LDPE prices will continue as weather conditions improve and demand rebounds.

Key Takeaways:

• LDPE prices rose in both Europe and the U.S. due to supply constraints, rising feedstock costs, and production disruptions.
• Severe weather in northern Europe disrupted inland container networks, causing logistical delays, surcharges, and higher insurance costs.
• In the U.S., LDPE prices increased, supported by steady demand in the downstream sectors despite supply disruptions.
• Severe cold weather in the US led to unplanned production outages and extended maintenance, tightening resin availability, and prompting aggressive spot buying.

Germany's LDPE market experienced a 1.3% price increase for Film grade in the first week of February, spurred by limited supply and rising feedstock costs. Production disruptions at local plants, combined with limited imports and high U.S. prices, intensified supply constraints. Severe weather in northern Europe further complicated the situation, disrupting inland container networks and causing logistical delays, surcharges, and higher insurance costs.

Despite moderate to low demand from key sectors such as construction, automotive, and packaging, the gradual stabilization of the Eurozone construction market provided some support. Urban housing and renovation projects, boosted by EU Recovery Funds, have started to lift demand for LDPE. However, the automotive sector remains under pressure, with declining passenger car sales impacting market sentiment.

ChemAnalyst forecasts that LDPE prices will continue to rise through February. In Europe, it is expected that feedstock prices will increase further, as improved weather eases logistical challenges. This will likely stimulate demand in both the construction and packaging sectors.

In the U.S., the LDPE market saw a more modest 0.8% price increase for Film grade FOB Texas by February 7, 2025. The price uptick was driven by steady demand from the packaging, construction, and automotive sectors, despite significant supply disruptions. Severe cold weather caused unplanned production outages and extended maintenance activities, tightening resin availability. This prompted aggressive spot buying, as buyers sought to secure material ahead of anticipated price hikes.

U.S. LDPE market dynamics were impacted by regulatory changes, including a 30-day tariff pause on imports from Canada and Mexico and a 10% tariff on Chinese imports. These changes add complexity to global trade but also contribute to upward price momentum. The strong export performance to regions like Europe, Africa, Mexico, and South America has further driven LDPE prices higher, tightening supply and reinforcing demand in both domestic and international markets. As a result, higher export prices and tariffs are expected to elevate LDPE prices while strengthening demand across sectors.

As winter conditions ease and production stabilizes, the U.S. LDPE market is expected to see a rebound in demand. Expanding manufacturing activity and strong export performance will likely drive further price increases. Despite ongoing trade uncertainties and inflationary pressures, rising feedstock costs and improving weather conditions are expected to support market recovery. With easing supply constraints, LDPE prices are set to continue trending upward throughout February, further tightening market conditions.