Polyethylene Rises and Then Falls in April; Demand Remains Weak

April 29 News: Curve Comparison Chart

In April, the polyethylene market in China as a whole showed a "rise and fall, weak recovery at the end of the month" pattern with a generally weak fluctuation. According to SpotCom data: The average price of LLDPE (7042) on April 1st was 8,716 CNY/ton, and by April 29th, it had decreased to an average of 8,425 CNY/ton, a drop of 3.35%. The average price of LDPE (2426H) on April 1st was 11,483 CNY/ton, and by April 29th, it had decreased to an average of 11,350 CNY/ton, a drop of 1.16%. The average price of HDPE (5000S) on April 1st was 10,212 CNY/ton, and by April 29th, it had decreased to an average of 10,082 CNY/ton, a drop of 1.27%.

Supply side: Initially tight, then easing, with pressure gradually being released. Early in the month: Some plants undergo maintenance/reduce output, social inventory is low, and traders have a strong desire to maintain prices, leading to a temporary tight supply. Mid to late in the month: Previously shut-down facilities resume production, new capacities are released, and there is an increase in imported goods arriving at ports, significantly raising the market supply pressure and continuously suppressing prices. At the end of the month: Some facilities enter maintenance again, and the previous low prices have dampened the production enthusiasm of some companies, slightly alleviating the supply pressure and supporting a small rebound in prices.

On the demand side, overall demand remains weak. Downstream industries such as plastic weaving, agricultural films, and packaging are experiencing sluggish order intake, keeping enterprise operating rates at low levels. Purchasing practices remain largely reactive—companies are primarily procuring materials on an as-needed basis, with little incentive to build up large inventories. Although lower prices at month-end have spurred some urgent restocking by businesses with immediate needs, this has not translated into sustained increases in demand, and overall, it remains difficult to generate meaningful upward pressure on prices.

Cost Perspective: Early in the month, international crude oil prices fluctuated and rose, providing strong cost support to the market and helping prices surge higher. In the mid-to-late part of the month, crude oil prices experienced a pullback due to macroeconomic concerns and inventory data, weakening cost-side support. Coupled with relatively weak supply and demand, this accelerated the decline in PE prices. At the end of the month, crude oil prices staged a modest rebound, leading to marginal improvement in cost conditions and helping PE prices recover from their low levels.

In the short term: On the supply side, there are still expectations of resumed production, while demand remains largely unchanged for now. At the cost end, fluctuations in crude oil prices remain the key variable, and prices will likely continue to fluctuate in a weak-to-moderately weak range.