India’s PP, PE markets gain steam on six rounds of local price hikes

India’s local polyolefin markets have entered February with a distinctly bullish tone as domestic producers implemented their latest price hikes this week. On February 9, leading suppliers raised quotations for homo-PP raffia by INR2,000/ton ($22/ton), while LLDPE film rose by INR2,500/ton ($28/ton) and HDPE film by INR2,000/ton. This move marks a decisive continuation of the recovery that began as the market emerged from its yearly lows towards the end of the previous year.

The market officially bottomed out in mid-December 2025, ending an eight-month decline that saw prices hit multi-year lows. Since then, six consecutive upward revisions have been made to local list prices as producers aggressively chased rising costs. Cumulatively, prices for film grades have climbed by INR9,500-11,500/ton ($105-$127/ton) from those December troughs, reflecting a major shift in market psychology and a return to seller-driven dynamics.

Producers chase costs amid rising feedstocks

The primary engine behind this turnaround is a strategic push by domestic producers to restore margins following the mid-December floor. The rising cost of naphtha — the core feedstock for India’s integrated crackers — has effectively raised the production floor for both PP and PE. This cost-push pressure, amplified by tightening domestic spot availability and a restocking surge ahead of PlastIndia 2026, has allowed producers to implement six rounds of hikes.

Supply-side constraints limit buyer options

Beyond feedstocks, supply-side tightening has played a critical role in the rally. Several domestic plants entered scheduled maintenance in late January, coinciding with a reduction in competitive import offers from the Middle East. This limited spot availability has left converters with fewer alternatives, allowing domestic producers to maintain their firm pricing stance despite moderate demand.

Macro optimism fuels restocking appetite

Market players also point to macroeconomic triggers, including the recent Union Budget 2026, which signaled strong infrastructure spending. This has boosted long-term optimism, prompting traders to restock inventories that had been kept lean throughout the late-2025 slump. The "fear of missing out" on lower prices has effectively replaced the previous "wait-and-see" caution.

Looking ahead, the sustainability of this trend will depend on whether the packaging and agricultural sectors can absorb these higher input costs. While the initial recovery was cost-driven, the market is now searching for a demand-led follow-through. For the current week, however, the sentiment remains firmly in favor of sellers as they look to capitalize on the ongoing supply squeeze.