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North American Resin Producers Push for May Contract Increases

April resin contract prices yet to be settled, but major North American producers have expanded their collective push for a May increase on Polypropylene (PP) and Polyethylene (PE) contracts. The proposed increases come amid higher supply chain costs, which include a combination of strong demand, tight supply availability, rising inflation, higher oil and gas prices, truck and rail surcharges, and higher warehousing costs.

Major North American resin producer LyondellBasell said on Thursday it will amend its $.04/lb April increase on PP to a $.06/lb increase, effective May 1. LyondellBasell's May initiative joins ExxonMobil and TotalEnergies, which also announced a May increase at $.06/lb, separate from any change in the Polymer Grade Propylene contract.

The proposed May PP increase also comes alongside additional strain on production and supply availability, following two force majeure declarations earlier this month, one at LyondellBasell's facility in Lake Charlies, Louisiana, and the other from Ineos Olefins & Polymers due to a power outage and manufacturing breakdown at its facility in Carson, California.

Meanwhile, Dow Chemical said in a letter to customers that it would be implementing a $.07/lb increase on all PE sold in the US and Canada, effective April 1. In addition, Dow said it would increase the price for all PE resins in the US and Canada by $.07/lb.

No other producers have formally announced a May PE increase yet, but other major producers including Chevron Phillips, ExxonMobil, LyondellBasell, Nova Chemicals, and Westlake have announced April increases within a range of $.05-.07/lb, depending on the commodity grade.

By Brian Balboa for The Plastic Exchange.

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