Plastic Price Trends
Plastic
Price movements
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Pig ddwt grade S exw EU EBP [BW56]
Month-on-month Change
Year-on-year Change
Key Takeaways
- The ongoing Middle East has added significant firm sentiment to the global plastics market, with markedly higher prices observed across Europe, the US, and China.
- Market sources expressed major concerns about tightening supply due to shipping disruption. Furthermore, the significant rise in crude oil prices has pushed feedstocks notably higher, increasing production costs across the global plastics market.
- Several buyers throughout the month stated that they were fixing purchases for the coming months at elevated levels, opting to pay higher prices in order to guard against the unpredictable and fast-changing nature of the Middle East conflict.
US
Increased production costs and supply worries due to the Middle East conflict pushed prices upwards.
- Throughout March, plastic products prices in the US moved upwards in line with continued supply concerns attributable to the US-Iran War, and the associated shipping disruption.
- Market sources also noted a rise in demand ahead of the peak season for PET production in spring and summer.
Market Sentiment
- The sentiment for the US plastics market moves from ‘steady’ to ‘mildly firm’ due to the ongoing Middle East conflict, which is pushing global plastics prices higher.
- Like in Europe, several buyers reported fixing purchases at elevated levels to manage risk associated with the war and the potential for continued volatility in feedstock prices.
- Although the most recent data showed manufacturing tailing of slightly, sources believe manufacturing is likely to move upwards to meet improved demand, particularly for polyethylene and PET.
Europe
Plastics prices rose markedly throughout March due to supply pressure resulting from the ongoing Middle East conflict.
- Prices for all plastic products in Europe rose markedly throughout March, driven by major worries associated with the ongoing Middle East conflict.
- The prospect of a shortage of feedstocks, particularly ethylene and propylene, has increased concerns among market participants about the available supply to produce plastic products, such as polyethylene and polypropylene.
- Demand for polyethylene and PET improved marginally with the coming of the spring.
Market Sentiment
- Sentiment within the European plastics market is reportedly ‘firm’ according to market sources, who remain worried about the supply of feedstocks and the increase in production costs due to markedly higher crude oil prices.
- According to participants, several buyers are fixing purchases where possible for the coming months, opting to fix at elevated levels in order to guard against the unpredictable nature of the Middle East conflict.
- Players anticipate that demand for plastics will continue to rise in advance of the summer and believe a supply shortage is possible if the war becomes protracted and feedstock prices continue to rise.
China
Prices moved sharply upwards, driven by higher production costs and shipping disruption.
- Market sources reported strong price increases in plastics products in China throughout March, chiefly due to the challenges posed by shipping disruption, delays, and shortages of ships.
- Players are also concerned about feedstock shortages due to the de facto closure of the Strait of Hormuz.
Market Sentiment
- Sentiment in China’s plastics market has moved from ‘steady’ to ‘mildly firm’, attributable to the conflict in the Middle East and associated shipping disruption, which market sources believe will continue to disrupt exports over the coming months.
- Producers hiked prices following the initiation of hostilities early in March due to the upward movement in freight costs.
- Additionally, market players are continuously concerned about the availability of feedstocks for plastic production, like in Europe and the US, due to the continued rise in crude oil prices.
Plastic
Price drivers
Crude Oil
Crude oil prices rose markedly throughout March due to the ongoing Middle East conflict and associated supply pressures.
Throughout March, crude oil prices again rose significantly MOM, chiefly attributable to ongoing military action in the Middle East, and the consequent supply concerns expressed by market participants.
Market sources noted that the continued de facto closure of the Strait of Hormuz is quickly tightening the crude oil market, with around 20% of global crude oil trade flowing through the waterway under normal circumstances.
Ethylene
Supply issues and higher naphtha prices added firm sentiment.
Prices moved upwards markedly throughout March due to growing supply issues caused by the war in the Middle East. Additionally, major price rises in the naphtha market added upward momentum to ethylene prices.
Propylene
Tightening supply due to the US-Iran War pushed prices higher.
Propylene prices rose notably throughout March, attributable to the ongoing Middle East conflict and a resulting tightened market.
Paraxylene
Prices spiked due to increased production costs and rising demand.
Prices spiked throughout the month due to the impact of the US-Iran War, which has pushed production costs upwards. Demand is also rising in advance of the summer as producers prepare for increased production of PET.
Macroeconomics
Annualized headline inflation in China hit a 3-year high in February.
In the US, inflation was 2.4% on an annualized basis in February, unchanged from January. In the Eurozone, inflation accelerated to 1.9% YOY in February, up from 1.7% in January, attributable to increases in unprocessed food and services inflation. In China, the CPI was 1.3% YOY in February, up from 0.2% in January and beating market participants’ forecasts of 0.8%. The result represented a 3-year high.
Logistics
The ongoing Middle East conflict pushed shipping rates higher throughout March.
The Global Shipping 40-foot Container Composite Index increased by about 20% MOM in end-March, to $2,279/unit, marking four consecutive weeks of increases. Following the start of US and Israeli military action in Iran and subsequent escalation in regional turmoil, energy prices have spiked, leading shipping carriers to apply emergency fuel surcharges to freight rates. This has driven higher spot rates on Asia-Europe and Transpacific rates. Market sources expect rates to remain elevated in the short term if the volatility and regional disruption persists. On routes outside of the region, sources state that operations remain relatively normal. Carriers continue to wait for an uptick in demand following the Chinese Lunar New Year, which has been slow to materialize.
Plastic
Price forecast
PET (US)
PET markets experienced a sharp price escalation in early 2026, driven primarily by the intensifying conflict in the Middle East. The region remains a critical node in global PET supply chains, hosting over 80% of the seaborne naphtha flows that feed Asian PTA and PET production. The escalation in regional tensions has disrupted these flows, tightening feedstock availability and amplifying cost pressures across the PET value chain. As these disruptions persist, we expect continued upward pressure on prices through the remainder of 2026, amid the growing backlog of vessels attempting to transit the Strait of Hormuz and the associated rise in freight rates and insurance premia.
On the demand side, the risk profile is similarly skewed to the upside. The US manufacturing PMI has risen steadily this year, signaling a broad‑based improvement in industrial activity that is likely to reinforce PET consumption in packaging, bottling, and downstream manufacturing. With supply constraints and demand recovery unfolding simultaneously, market balances are set to tighten further, leaving PET prices highly sensitive to any additional geopolitical or logistical shocks as the year progresses.
Seasonal trends may provide some relief through the summer, but this is not expected to be sufficient to offset the other fundamental concerns.
PP (China)
Chinese Polypropylene prices have trended higher throughout 2026, reversing almost all of the weakness seen since the covid-pandemic induced price high in the fall of 2021. Initially, rising prices were driven by stronger economic activity. However, the key driver behind the much higher prices has been the conflict in the Middle East. The closure of the Strait of Hormuz has effectively halted 20% of the world's oil supply from reaching the market. The Middle East remains a critical node in global supply, particularly for Asia. With Asia's cracker systems highly naphtha-based and with 80% of the seaborne naphtha flows that feed Asia passing through the Strait of Hormuz, supply has been, and still is, under serious constraints. On top of disrupted supply flows, related costs have increased due to rising freight rates, higher insurance premiums, and longer transit times for alternative supply routes.
In the fall of 2025, technical analysis warned of an upcoming uptrend in Chinese Polypropylene prices. In January, the first signal validating an uptrend appeared when prices broke above the moving average, and the uptrend was later confirmed in February by the momentum indicators. This means that Chinese Polypropylene prices were already in an uptrend when the Middle East Conflict started on February 28 and that the Middle East Conflict only have amplified the upmove. Chinese Polypropylene prices have increased by almost 60% since the December 2025 low.
The Middle East conflict significantly impacts the Chinese Polypropylene market, and even if a peace agreement is reached, its lasting effects will continue to shape the market's dynamics for months to come.
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