As the conflict in the Middle East continues, the price transmission chain from oil to plastics is profoundly impacting various industries. EVA, EAA/EMAA, EVOH, PC/ABS, PMMA, POM, and even high-end specialty engineering plastics such as PPSU/PSU/PES have all been involved in this wave of price increases without exception. Market data witnessed a surge across the board Data According to Cinda Securities, the EVA supply side tightened this week, and Gulei Petrochemical’s units entered the maintenance phase, further reducing market supply, leading to a sharp increase in product prices. At the same time, PC prices have risen from a low of about 10,000 yuan/ton last year to more than 14,000 yuan/ton now, up 40% in a week after the conflict in the Middle East intensified on February 28. The previous price of ABS materials was about 9,000 yuan/ton (including tax), but now some quotations have risen to 12,000 to 13,000 yuan/ton. In the field of special engineering plastics, high-end medical-grade materials such as PPSU (polyphenylene sulfon), PSU (polysulfonamide) and PES (polyether sulfur) are also facing cost pressure. These materials are widely used in high-end fields such as medical devices, baby bottles, and aerospace, requiring extremely high supply chain stability. Despite rising costs, price transmission is relatively smooth due to high technical barriers and difficulty in substitution. Downstream companies are adopting multiple strategies to meet the challenge In the face of a wave of rising prices across all product categories, downstream companies are adopting various strategies to cope. Kingfa Technology, Asia’s leading improved plastics company, recently sent an open letter to customers saying that rising crude oil prices have pushed up industry costs. The company said it will share some of the pressure through internal management, but still need to share some of the incremental costs with downstream customers. Long Zhixiong, general manager of Guangdong Visme New Material Technology Co., Ltd., said: “We are communicating with customers to discuss price adjustments on the one hand, and on the other hand, we recommend reducing orders in the short term. During market volatility, there is no need to take risks. “Guangdong Rongsuhua New Materials Technology Co., Ltd. chose to pay a 20% premium to ensure the factory’s capacity and customer orders to be met. The industry generally believes that this round of price increases is a comprehensive test of the supply chain management ability and cost control ability of enterprises. Under cost pressures, companies equipped with core technologies, solid customer relationships and supply chains are expected to occupy a more favorable position in the market restructuring.
