The CY 2023 withholds an up & down ride for plastic prices, struck by a complex interplay of surging demand, fluctuating production, and volatile feedstock costs. The global consumption of plastic products is moving fast due to rising disposable incomes and various applications of plastics in various industries. From the effect of worldwide occasions on feedstock expenses to advancing production network difficulties, understanding the year’s cost patterns is critical for anybody engaged with the plastics business. This article gives a brief outline of price fluctuation across the CY23 along with the reason for these price changes.
The Asia-Pacific region dominates the global plastic manufacturing market, with China being the largest producer of plastics. The top producers of polyethylene in the world are the United States, China, and Western Europe. China consistently produces around seven million metric tons of plastic products monthly. The United States is the second-largest producer in North America, with plastic production reaching approximately 56.9 million metric tons. Plastic demand is on a continual rise, with production expected to reach 589 million metric tons by 2050.
Consumption of plastics in India
In India, plastics are significantly utilise in the auto and packaging sectors, and this sector contributes to 66 % of all out total consumption, the building material is the 3rd largest sector and as India is focusing on infrastructure which cause high demand in this sector. Any adjustment of utilisation from these area can cause plastic price fluctuation.
Reason of Plastics Prices change in India and Outlook
- As shown in the graph the plastic price show a, prices steadily declined from February to June due to reduced demand in packaging and construction, influenced by a global economic downturn and sluggish market growth in China. These reason cause the 8% decreased in the LDPE price and HDPE price decreased by 9%.
- The High Density Poly Ethylene prices in September were influenced by fluctuating ethylene costs, alongside a minor operational adjustment linked to declining
- international crude oil prices and reduced cost-side support for the product. It caused the 6 % increase in the HDPE plastic prices in India.
- The end-use industries like Extrusion coating, General purpose, Adhesive, Liquid packaging, and Heavy Duty are anticipated to hike the demand for Low Density Polyethylene in the upcoming years.
Future Outlook
The future of plastic prices in India remains uncertain. Various factors will continue to fluctuate the prices of plastic in India.
Supply Chain Challenges: A constant Hurdle: The weakness of worldwide of global supply chains remains a concern, with potential interruptions influencing the inventory of the supply chain impacting raw material flow and thus pushing prices upwards.
Crude Oil Price Trajectory: A Wild Card: One of the significant natural substances utilized in the production of plastics Crude oil is one of the major raw materials used in the manufacturing of plastics and the uncertain path of crude oil prices will continue to fluctuate the cost of plastic production in India.