Polyethylene Has Risen Strongly Since January

January 15th, News

According to the commodity market analysis system, the average price of LLDPE (7042) on January 1st was 6,410 CNY/ton, and on January 15th, it was 6,890 CNY/ton, an increase of 7.49%. The average price of LDPE (2426H) on January 1st was 8,400 CNY/ton, and on January 15th, it was 9,283 CNY/ton, an increase of 10.52%. The average price of HDPE (2426H) on January 1st was 6,862 CNY/ton, and on January 15th, it was 7,300 CNY/ton, an increase of 6.38%.

In 2026, at the beginning of the year, polyethylene showed a strong upward trend, with LDPE leading the increase due to its high import dependency. The main factors were the geopolitical risks in Iran driving up crude oil costs, expectations of tighter supply of imported high-pressure materials, and limited support from the supply and demand fundamentals in China.

Cost side: The situation in Iran has sparked concerns about crude oil supply, causing crude oil prices to surge. This strong support from the cost side provides robust backing for polyethylene.

On the supply side: The expected shutdowns and maintenance of polyethylene plants remain relatively strong, and the pace of commissioning new capacity has slowed down, leading to a slight contraction in supply. Although previously shut-down units are gradually resuming operations, overall operating rates remain relatively low, thereby easing the pressure from oversupply. LDPE exhibits a high degree of import dependency, and tight shipping conditions coupled with anticipated delays in cargo arrivals are driving up prices for high-pressure materials.

On the demand side: Agricultural film is entering the off-season, while packaging film is primarily driven by essential inventory replenishment, leading to growing resistance toward higher prices. Inventory replenishment ahead of the Spring Festival provides temporary support for demand; however, as factories gradually shut down from late January to early February, demand will further weaken.

Futures Market: The main contract for linear low-density polyethylene (LLDPE) has been fluctuating and rising, closing at around 6,766 CNY per ton on January 14, providing positive momentum to spot prices of polyethylene.

Driven by cost support and stronger futures prices, spot prices are fluctuating at high levels. However, downstream buyers are reluctant to accept the high prices, leading to a slowdown in transactions and limiting upward momentum. We expect polyethylene prices to remain volatile at high levels in the short term, with the upward trend slowing down.