Plastic polymer prices up 13% since April

Despite the partial ban on plastic products in some states, prices of its key raw materials have risen up to 13 per cent over the past two months. This is due to rising crude oil prices and consumption from export-centric manufacturers.

Data compiled by plastemart.com show the benchmark B56003 grade high density polyethylene (HDPE) is up 13 per cent to ~106,668 a tonne for delivery in Kolkata, from June 1. Trade sources said major polymer producers have raised their product prices further by ~1,000-1,500 a tonne from this week. Prices of plastic raw materials are linked with crude oil price variations in global markets.

“Polymer prices have jumped in the domestic markets due to a sharp increase in crude oil prices. While polymer demand has been impacted a bit due to the (partial) plastic ban in Maharashtra and (six) other states, its consumption continues from export-oriented plastic industries of value added products,” said Pradip Thakkar, vicechairman of Mechemco Industries, one of India’s largest makers and exporters of such products.

From January 1, HDPE prices have risen by up to 36 per cent. Those of other varieties of polymer — LDPE, LLDPE, PVC, polypropylene — have also risen, albeit slower.

According to data from The Plastics Export Promotion Council, the country’s export of plastic products grew 17.1 per cent to $8.8 billion in 2017-18 from a year before, a faster pace than overall merchandise export growth at 9.9 per cent. Plastics comprised 2.9 per cent of merchandise shipment.

America, China and the United Arab Emirates were the top three destinations for India’s plastic products in FY18. These three countries accounted for a fourth of our plastic product export by value.

Polymer prices are expected to remain firm in the near future, as crude oil prices are expected to rise (they have done so by 14 per cent this calendar year), apart from user industry demand.

“Banned products contribute less than five per cent of the entire plastic industry. Demand for the other products has been increasing consistently over several years. The government must focus on irresponsible disposal of used plastics, instead of a blanket ban on certain grades,” said Thakkar.