# Bio-based polyethylene and MEG: Correlation Prices it moves with, and why Source page: https://www.materialinsights.org/chemicals/bio_pe/correlation/ Bio-based PE and MEG are made from sugarcane ethanol, PE mainly in Brazil and MEG mostly in Asia, and sold at a premium over identical fossil ones. Their price follows fossil markets plus a green premium, with ethanol cost and brand demand for low-carbon packaging. Proxy **US PPI: thermoplastic resins and plastics materials** index (BLS base period =100) · monthly, Jan 2006 to Sep 2026 There is no free public price for Bio-based polyethylene and MEG itself, so this tab uses the closest public series as a stand-in. Read the numbers as an indication, not as the price of this exact item. #### What its price moves with Selected link ##### Bio-based polyethylene and MEG and Polyethylene (LDPE, LLDPE) Monthly changes 0.99 strong correlation 12-month changes 1.00 strong correlation Last 5 years 0.99 monthly changes Lead or lag none No clear lead or lag Price function, Jan 2006 to Sep 2026 Bio-based polyethylene and MEG ≈ 0.939 × (Polyethylene (LDPE, LLDPE))^1.02 R² 1.00 On this fit, a 10% higher Polyethylene (LDPE, LLDPE) price goes with a 10.2% higher Bio-based polyethylene and MEG price over the long run. Units: index (BLS base period =100) and index (BLS base period). Chart: Bio-based polyethylene and MEG and Polyethylene (LDPE, LLDPE) prices rebased to 100 at Jan 2006, log scale Both prices rebased to 100 at Jan 2006, on a log scale so equal percentage moves look the same size. Chart: Bio-based polyethylene and MEG price against Polyethylene (LDPE, LLDPE) price, monthly, log scales, with fitted line Each dot is one month; paler dots are older (2006), darker dots recent (2026); the ringed dot is the latest month. The dashed line is the fitted price function. Both axes are logarithmic. Chemical [LLDPE Polyethylene (LDPE, LLDPE)](https://www.materialinsights.org/chemicals/polyethylene/)Fossil twin 0.99 Bio-PE is chemically the same as fossil polyethylene, so it is priced as fossil PE plus a premium. The proxy here is the same US thermoplastic resins index used for fossil PE, so it shows the fossil market, not the premium. strong co-movement month to month · 249 months Show charts Chemical [C2H4 Ethylene](https://www.materialinsights.org/chemicals/ethylene/)Fossil route 0.72 Fossil PE is made from ethylene cracked from naphtha or ethane, while bio-PE uses ethylene from dehydrated ethanol. The resin proxy follows ethylene closely: monthly moves correlate at 0.72 and yearly moves at 0.90. strong co-movement month to month · 249 months Show charts Chemical [EtOH Bioethanol](https://www.materialinsights.org/energy/bioethanol/)Feedstock 0.20 Bio-PE plants dehydrate cane ethanol into ethylene, so ethanol is the main cost. The US ethanol index is corn ethanol, not Brazilian cane, so it links only through the wider fuel market: monthly moves correlate at 0.20, yearly at 0.61. little or none co-movement month to month · 249 months Show charts Commodity [Su Sugar](https://www.materialinsights.org/commodities/sugar/)Competing use 0.06 Brazilian mills choose between making sugar and ethanol from cane, so a high sugar price raises the cost of ethanol for bio-PE. The proxy is a fossil resin index, so the link barely shows, with yearly moves correlating at 0.25. little or none co-movement month to month · 249 months Show charts Chemical [MEG Monoethylene glycol](https://www.materialinsights.org/chemicals/meg/)Product made 0.31 Bio-MEG for PET bottles is also made from cane ethanol through ethylene oxide. It shares the ethanol cost and the green premium; the US proxies show monthly moves correlating at 0.31 and yearly moves at 0.67. weak co-movement month to month · 249 months Show charts Energy [Bag Bagasse and black-liquor cogeneration](https://www.materialinsights.org/energy/e_bio_cogen/)Energy source Brazilian cane mills burn bagasse to supply their own steam and power, which keeps the energy cost and carbon footprint of cane ethanol low. This is part of why bio-PE is made from cane rather than from corn. Not enough overlapping price history to measure. How to read these numbers **Correlation of monthly changes** (the number in the coloured pill) compares how much each price moved, month by month, since 2006 or the first month both series exist. It runs from −1 to +1: near +1 the two usually rise and fall in the same months, near 0 there is no link, and a negative number means they tend to move in opposite directions. Above 0.7 is strong, 0.4 to 0.7 moderate, 0.2 to 0.4 weak. **12-month changes** compare year-on-year moves, which shows whether two prices share the same cycles even when the month-to-month noise differs. **Price function** is a straight-line fit of the two prices on logarithmic scales: price ≈ k × (partner price)^β. β is how much this price moves, in per cent, for a 1% move in the partner over the whole period, and R² is the share of the variation the fit explains. Two prices that both drift up with inflation can fit well without any real link, so read it together with the monthly correlation. **Lead or lag** checks whether the monthly correlation is clearly higher when one price is shifted by 1 to 6 months. Correlation is not cause. The reasons on each card explain the economic link; the numbers show how strongly it has shown up in prices. Proxy series are US producer price indexes or related prices and can blur the real link. Data: World Bank Commodity Price Data (Pink Sheet), October 2026; US Bureau of Labor Statistics producer price indexes, IMF primary commodity prices and US EIA prices via FRED, Federal Reserve Bank of St. Louis, retrieved November 2026. Calculations by this site. ## Other sections - [Summary](https://www.materialinsights.org/chemicals/bio_pe/index.md) - [Overview](https://www.materialinsights.org/chemicals/bio_pe/overview/index.md) - [Production route](https://www.materialinsights.org/chemicals/bio_pe/routes/index.md) - [Production](https://www.materialinsights.org/chemicals/bio_pe/production/index.md) - [Feedstocks](https://www.materialinsights.org/chemicals/bio_pe/feedstocks/index.md) - [Cycles](https://www.materialinsights.org/chemicals/bio_pe/cycles/index.md) - [Trading](https://www.materialinsights.org/chemicals/bio_pe/trading/index.md) - [Movement](https://www.materialinsights.org/chemicals/bio_pe/movement/index.md) - [Regulation](https://www.materialinsights.org/chemicals/bio_pe/regulation/index.md) - [Characteristics](https://www.materialinsights.org/chemicals/bio_pe/characteristics/index.md) - [Emissions](https://www.materialinsights.org/chemicals/bio_pe/emissions/index.md) - [Relationships](https://www.materialinsights.org/chemicals/bio_pe/links/index.md)