Resin prices rise with solid demand, higher raw material costs

Solid demand and higher raw material prices have sent North American prices for PVC and polystyrene resins up since April 1.

PVC prices have increased an average of 3 cents per pound, according to market sources. Prices for the material had also ticked up an average of 1 cent per pound in March after tough negotiations between buyers and sellers. Regional PVC prices now are up a net of 1 cent per pound since Jan. 1.

PVC availability has been affected by production challenges and power outages at vinyl chloride monomer (VCM) feedstock plants operated by Olin Corp. in Plaquemine, La., and Freeport, Texas. Sources said Olin's Freeport plant is improving, but challenges remain at the Plaquemine site.

Rail traffic also has presented a recent obstacle for PVC makers, one market source said.

"The railroads are trying to get their situations straightened out," the source added. "The [PVC] market seems pretty strong, but this latest episode with Olin may tighten things up a bit, and finding additives is still very stressful."

Construction activity is a main driver of PVC consumption. U.S. housing start activity in March came in at a 1.79 million annual rate, up more than 3 percent vs. the same month in 2021, but flat vs. February. This trend might be an indication of PVC demand leveling off.

In PS, prices surged an average of 9 cents per pound in April after climbing a combined 9 cents in February-March. The April hike again followed higher prices for benzene, which is used to make styrene monomer. Prior to February, regional PS prices had been flat for five consecutive months.

Benzene prices for April closed at $4.09 up more than 8 percent vs. March. A market source said that lower production from PS maker Americas Styrenics and an inability to source lower-priced imported PS sent prices higher in April.

Materials maker Trinseo of Berwyn, Pa., continues to seek a buyer for its PS unit, including resin and feedstocks. The proposed sale was announced in November. It would include PS units in Belgium, Germany, Hong Kong and Indonesia and styrene monomer units in Germany and the Netherlands.

The sale also will include Trinseo's stake in Americas Styrenics, its 50-50 joint venture with Chevron Phillips Chemical Co. AmSty operates five PS resin plants in the U.S., as well as one in Colombia and a stryrene monomer unit in St. James, La.

The ongoing Ukraine crisis has sent global oil prices up since Russia invaded that nation Feb. 24. West Texas intermediate crude oil prices closed around $102 per barrel April 27, up almost 11 percent since Feb. 24. Prices had been above $120 in March.

That's had an impact on gasoline prices, and an even bigger effect on prices for natural gas feedstock. Natural gas prices were up more than 57 percent between Feb. 24 and April 27, when they closed at $7.27 per million British thermal units.