High-density polyethylene and Natural gas

Natural gas is a raw material for high-density polyethylene; their prices have moved together.

High-density polyethylene (chemical) and Natural gas (energy): 2 relationships.

How they are linked

1. Feedstock

Physical flow · Direct · Natural gas → High-density polyethylene

High-density polyethylene is made from natural gas: it is one of the raw materials its production routes start from.

2. Price link: feedstock cost

Cost and price · Strong · Both ways

US and Middle East crackers run on ethane from gas, which makes them low-cost HDPE exporters. European gas moves with the resin proxy at 0.11 monthly and 0.75 yearly, little monthly tie but a strong yearly one.

• 0.11 monthly change correlation
• 0.75 12-month change correlation
• 0.15 fitted elasticity

Built from the site data on production routes, energy flows, industry value chains, input-output tables and prices.