India PP & PE Stay Firm Despite Feedstock Fall; PVC Faces Pressure Ahead of Monsoon

India’s import polymer market is showing a mixed trend as the monsoon season approaches. While imported PP and PE prices have remained relatively stable despite a sharp decline in upstream feedstock costs, PVC continues to weaken under seasonal demand pressure and ample supply availability.

By the end of May, import offers for PPH Raffia were holding near $1300/ton, while HDPE Film and LLDPE Film remained firm around $1385/ton and $1375/ton respectively. In contrast, suspension PVC K67-68 dropped to around $890/ton as buying activity slowed.

Middle East Conflict Reshaped Market Dynamics

The current market structure can be traced back to the sharp rally triggered by tensions in the Middle East earlier this year. Rising concerns over supply disruptions around the Strait of Hormuz pushed crude oil and feedstock prices sharply higher during March and April.

During the peak of the rally, crude oil prices crossed $110/barrel, while ethylene and propylene reached multi-year highs. This resulted in significant increases in polymer import prices, with LDPE, HDPE, and PVC reaching elevated levels across the Indian market.

However, over recent weeks, energy and feedstock markets have corrected sharply. Crude oil has fallen back toward $95/barrel, while both ethylene and propylene prices have dropped substantially from their peak levels.

PVC Weakens as Seasonal Demand Slows

Despite lower feedstock costs, PVC has faced stronger downward pressure than polyolefins. Early monsoon rains have already affected outdoor infrastructure and pipe installation activities across several regions, reducing demand from key end-use sectors.

At the same time, weaker construction activity, cautious buyer sentiment, and abundant supply from Asian exporters have intensified pressure on PVC prices. As a result, import PVC values have seen a significant correction compared to the highs recorded during the conflict-driven rally.

PP & PE Continue to Show Resilience

Unlike PVC, PP and PE have managed to maintain support due to relatively healthy packaging demand, controlled inventories, delayed replenishment cycles, and tighter import availability.

These factors have helped prevent a sharp correction in polyolefin prices, even as feedstock costs moved lower. Domestic producers have also taken advantage of the situation by increasing local polymer prices heading into June, aiming to improve margins after a period of cost volatility.

Converters Face Cost Challenges

Plastic converters are facing increasing pressure despite softer global feedstock markets. A weaker Indian rupee has raised the cost of importing dollar-denominated cargoes, limiting the benefits of lower international prices.

In addition, higher domestic fuel costs have increased transportation and manufacturing expenses, adding further pressure on processing margins. As a result, many converters remain cautious with purchases and continue to buy only according to immediate requirements.

Market Outlook

Market participants believe India's polymer market is no longer moving solely in line with crude oil and feedstock trends. Over the coming months, demand recovery, inventory levels, monsoon-related consumption patterns, and converter buying behavior are expected to play a more important role in determining market direction.

While PP and PE continue to find support from tighter fundamentals, PVC may remain under pressure until seasonal demand improves and construction activity gains momentum.

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