Indian Polymers Bracing for Recovery Against Global Trade Resumptions and Firming Crude

Indian polymer industry is exiting the second quarter with a sigh of relief. Domestic prices bounced back after producers announced upward price revisions for HDPE, LDPE and LLDPE grades which may help them in recovering the losses incurred during the period between Feb-May'20. With gradual reopening of global economies, producers are now eyeing to recoup the inventory losses incurred during the last few quarters due to the pandemic led market slowdown. The current Polyethylene rates are higher almost by 7-14% since May this year. This increase has been attributed to resumption in trade activities across the globe, further supported by gradual recovery in crude futures. A trader remarked that while LDPE outperforms other polymers in the Indian basket, Polypropylene (PP) is still managing to regain momentum. If we talk about individual polymers, PP is currently trading around INR 85.5 per kg, up by about 1.2% since 1^st July while LDPE which was trading around INR 81 per kg on 1^st July has risen to INR 89 per kg, depicting a rise of almost 9.9% within this quarter. Showing a similar trend, HDPE and LLDPE have also regained values almost by INR 4-6 per kg. As per analysts, while other polymers seem to be fully recovered, the outlook for Polypropylene, which has shown a minimal improvement, still remains lower due to muted market outlook for industrial products and furniture where PP is mainly consumed.