Expect U.S. polyethylene (PE) prices to go lower into the end of 2016, but plan for continued strong, high prices for polypropylene (PP) for the year. That’s the view of Nick Vafiadis, Global Business Director, Polyolefins and Plastics, IHS Chemical. He spoke at the FPA Annual Meeting in early March.

For PE, a combination of market pricing for feed stocks and overcapacity in resin production could put the resin price at somewhere near 45-cents per pound for high-density PE at year’s end.

Vafiadis expects excess PE capacity to come onto the market through 2017 and into 2018. He notes that even if some new capacity is delayed, it will have minimal impact on total oversupply.

PP, on the other hand, remains a seller’s market. U.S. demand could exceed North American capacity in 2016, and, Vafiadis says, “2016 will be the year of the imports.” It is possible to see switches in resin usage as PP become less competitive in North America.

For More Info

For a copy of The Polyolefin Market Update, FPA members can go to www.flexpack.org. Click on: “Download Presentations from the FPA Annual Meeting.”