At a time when polymer prices have already risen by 40 to 100% in the past nine months, they have been raised again by the larger Indian suppliers from 1 April 2021. Reliance Industries raised the price of high-density polyethylene (HDPE) by Rs 3,000 a ton, the price of linear low-density polyethylene (LLDPE) rates by Rs 2,000 a ton, and of low-density polyethylene (LDPE) by Rs. 7,000 on the first day of the new financial year. Reliance also increased the price of extrusion coating grade LDPE by Rs. 9,000 a ton.
ONGC Petro Additions raised its HDPE polymer price by Rs. 4,000 a ton and LLDPE by Rs 2,000 a ton – also from 1 April 2021. The other significant Indian polymer suppliers include other public sector companies Indian Oil Corporation, Mangalore Refineries and Petrochemicals, Haldia Petrochemicals, and Gas Authority of India.
The polymer price hikes have been less frequent in the last couple of months than in the previous year. There have also been occasional price reductions linked to the fluctuation of crude oil prices. Still, one cannot dismiss some of the disruptions in shipping, such as the Suez canal’s temporary blockage since India has become the largest purchaser of US crude oil. The storms in the Southern US and the global shortage of containers have also constrained polymer imports.
Industry experts expect fewer price hikes for polymers in the coming months since the high demand in March seems to have cooled slightly in April, although it is still robust. Some experts also expect polymer prices to decline after June.
The Indian Plastic Manufacturers Association (IPMA) says that polymers are exported by Indian manufacturers, including the public sector oil companies, at prices lower than those offered to domestic customers. The IPMA has urged the central government to set up a ‘Petrochemical Regulatory Authority’ to supervise the polymer market. However, industry experts say this is unlikely given the government’s lack of activity in previous crises.
The flexible packaging industry that has fared well in the past year of the pandemic is a significant consumer of polymers and has considerable capacity-building investments in the pipeline to be installed from the last quarter of this year.