Prices in the polyolefin market in Poland in 2024 changed due to various factors, such as: the level of demand from converters, the availability and quantity of imported material, the price of oil, the impact of the overall European economy, as well as the geopolitical situation worldwide.
Overall, all types of PE reacted similarly to the changing market conditions. However, it is worth highlighting LDPE, as demand for it was usually higher than for other PE.
On the PP market, PP raffia stood out. The Polish producer of this material, conducting tests and quality measurements, supplied the market with its relatively cheap product, compared to competitors, throughout the year, forcing many traders to simply stop dealing in this material. As a result, starting from April, the price of PP raffia remained unchanged almost until the end of the year, with only a small increase of €50/t in August and a similar drop in October. The prices of injection-moulding PP, block copolymer, and random copolymer, in turn, reacted relatively similarly to market changes.
The year began with the crisis in the Red Sea, which significantly impacted global supply chains. The adaptation period took several weeks for carriers, during which a window emerged when imported products, mostly from Asia and the Middle East, were delayed in arriving at European ports. The increase in logistics costs, as well as longer delivery times, affected the availability of imported goods in Q1 2024. Notably, issues with high transportation costs and extended delivery times persist to this day, one year after the start of the so-called crisis.
During this period, a shortage of many LDPE grades began, with the deficit of grades with MFI=0.3/0.75 continuing to this day. The distortion of the supply-demand balance was also influenced by planned and unplanned maintenance at European facilities.
From January to March, prices for HDPE, LDPE, and LLDPE increased by €200/t, €340/t, and €220/t, respectively, in Poland. Prices for homopolymers, block copolymers, and random copolymers of PP rose by €60/t, €130/t, and €90/t, respectively. After peaking in March, prices for all types of polymers began to decline. They reached their lowest level in June, but from July onwards, prices started to rise again.
At the end of June, many converters began to halt their own production for the summer shutdown and maintenance, resulting in a decrease in demand, which led to a drop in prices. The period from July to August was marked by issues with the availability of imported material and an increase in freight costs, which caused a slight increase in the price of all types of PE and PP produced in Europe. The problem with the availability of imported material was only resolved in the autumn.
In August, for various reasons, several producers in Europe, such as Unipetrol, ExxonMobil, Borealis, and INEOS, stopped production, and the Hungarian producer began experiencing issues with access to Russian oil, which contributed to the rise in prices of all types of PP.
At the end of August and the beginning of September, after emerging from the summer downtime, finished goods producers increased their activity in purchasing polyolefins, although most market players noted that the level of demand had yet to return to the levels of February-March 2024. In September, the delivery of imported PP was also restored, which balanced the shortage of material from the Slovak producer, who had halted production for scheduled maintenance. From this point on and until the end of the year, polymer prices began to steadily decline.
Several factors can explain the moderate or weak demand from converters during this period:
- The overall energy crisis in Europe and the general economic downturn, which had a significant impact on the industry, leading to reduced production volumes and energy cost issues;
- Stagnation in the automotive and construction industries - more and more factories in Europe began suspending or closing their operations, reducing capacities, or relocating them to Asia or South America. According to GUS, car production in Poland decreased by 27.9% in 2024;
- Converters who had stocked up in the summer held sufficient material reserves in their warehouses and were in no rush to make purchases, constantly waiting for prices to decrease. This also included a reduction in order levels from converters themselves, which failed to support an increase in demand;
- Geopolitical events around the world - such as the ongoing war in Ukraine, conflicts in the Middle East, the US elections, and competition between China, the US, and the European Union - led to an increase in risks and a decrease in investment in manufacturing in Europe.
As a result of the above-mentioned factors, 2024 ended with the lowest prices of the year, with only January being lower.
