HDPE Prices Dropped Due to Low Demand in Asia During February 2024

HDPE prices declined due to decrease in its demand in the Asian market, especially in China and India during February 2024. The drop in the prices was evident with an increase in the inventories amid limited transactions in Asia. According to the analysts at Procurement Resource, HDPE prices in China saw a 1.40% month-on-month decrease in February 2024.

Prices of HDPE Declined after a Slight Increase Observed During January 2024

The prices of HDPE remained low throughout February after experiencing a slight rise in its costs during January 2024. The costs of HDPE were supported with positive sentiment as the prices of polyethylene (a raw material for HDPE) slightly increased during January 2024.

The rebound in crude oil prices (a feedstock for polyethylene) contributed towards the increase in the costs for polyethylene or PE as well as HDPE in the global market. The increase in the cost of crude oil promoted the anticipation of domestic interest rate cuts and strengthened a positive market sentiment for HDPE as well.

Operational Break in the HDPE Production Units Weakened the Market Demand During February 2024

As the spring festival holidays approached, the operational units that are dedicated for HDPE production gradually lowered the production levels during the month of February. However, the decline in operation rate, didn’t affect the inventory levels resulting in stockpiling. The situation of low production and stockpiling weakened the demand in the market during the month and led to the decrease in the prices of HDPE in the polymer market.

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According to Procurement Resource, the prices of HDPE declined during the month of February from January 2024. Slowing down of production units before the spring festival holiday period, influenced the demand for HDPE, causing an increase in the inventory levels throughout the month. An analysis by Procurement Resource reported an m-o-m decline of around 1.40% in the costs of HDPE during February 2024.