US polyethylene producers are pushing for September price increases and their arguments center around lost production, because of Ida and Nicholas, and rising costs because of the much firmer natural gas and ethane markets. Working against them are the very high margins and what appears to be a stubborn spot market, both covered in the charts below. A contract increase in September would maintain an unprecedented gap between US contract and spot pricing, and while it is likely that the spot market is very thin, it is a very strong push back against producers for a contract hike.
Source: Bloomberg, C-MACC Analysis, September 2021
Separately, the linked headline about the Asia/US polypropylene arbitrage is spot on. You can afford the move the polymer as long as you can find a container, and find a customer willing to take on delivery by road, the uncertainty of supply timing, and also the possible uncertainty of product quality. We see some volumes moving, but to date, they have not been enough to impact US prices. We think the bigger risk for US polypropylene is any cut back in demand associated with auto production, but if that is going to have an impact it should be imminent. See more in today's daily report.
Source: Bloomberg, C-MACC Analysis, September 2021