HDPE Procurement Intelligence

In this HDPE procurement intelligence report, we have estimated the pricing of the key cost components. Raw material constitutes about 60-65% of the total cost during production. Assets and utilities are other major cost components of HDPE production. The kind of product, size, and complexity, as well as the volume of manufacturing, are some of the variables that also impact the cost of the category. Additionally, the cost of production is impacted by whether it is manufactured using injection or extrusion molding. Injection molding has a significant impact on the manufacturing process, even though it is perceived as more expensive than extrusion. For enterprises to continue to be profitable and competitive at the same time, other elements such as the cost of labor, utilities, and assets must be taken into account throughout production.

Extrusion, injection, and injection stretch blow mold are a few examples of blow molding manufacturing processes that are utilized for packaging and are priced according to the complexity of the process. The extrusion process is less costly, with tooling costs around 80% to 90% less than injection molding. The price is more affected by equipped technology, which includes 3D printing, miniaturization, lightening, and automation utilized in product packaging.

Order your copy of the HDPE category procurement intelligence report 2023-2030, published by Grand View Research, to get more details regarding day one, quick wins, portfolio analysis, key negotiation strategies of key suppliers, and low-cost/best-cost sourcing analysis

Operational Capabilities - HDPE

• Geographical Service Provision  - 23%
• Industries served - 21%
• Years in Service - 17%
• Revenue Generated - 15%
• Employee Strength - 15%
• Certifications - 9%

Functional Capabilities - HDPE

By type:

• Injection Molded, Blow Molded - 15%
• Packaging Options - 15%
• Operating Capability - 15%
• Durability - 15%
• Quality Measures - 15%
• Technology - 15%
• Others - 10%

Rate Benchmarking

For instance, in North America, HDPE has shown a price decline due to sluggish demand from downstream packaging and construction industries in Q2 2023. The category's main raw material, ethylene, has experienced a declining trend, which has impacted the way HDPE is processed. In 2023 the price of HDPE in Mexico was reported to be USD 1,392/MT, a 1% decrease from 2022. Prices in the Asia region area are also anticipated to decline in 2023 because of the excess supply of HDPE and reduced demand from the construction and packaging sectors. The downturn in HDPE pricing has also been driven by lower upstream ethylene and crude oil prices in Q2 2023. In 2023, Singapore’s prices were reported to be around USD 1,050/MT on average in Q2 2023. 

The cost of HDPE production also varies depending on the scale of the project. For example, a small business that is simply looking to produce on a smaller scale will likely pay higher than a large enterprise that is looking to produce on a large scale. Prices also depend on the complexity of the production. For instance, injection molding has the highest complexity among all others, but with larger complexity, it delivers more accuracy and precise production. The cost is also high, around 50 -60% higher than the extrusion type.

Supplier Newsletter

In August 2023, ExxonMobil created a brand-new high-density polyethylene (HDPE) grade, named ExxonMobil HD7165L, which had superior optical and mechanical properties. The novel product is designed for use in MDO PE film applications. It is suited to enable mono-material laminated packaging that can be used to package FMCG goods such as chips, granola bars, sauces, crackers, and etc.

In July 2023, Republic Services and a major global polymer company, Ravago, formed a joint venture worth USD 350 million in order to produce recycled pellets at four American plants. Their two plants are under construction in Las Vegas and Midwest. The Republic contributes 45%, while Ravago contributes 55% to the initiative. The four sites combined will be able to generate 300 million pounds of recycled HDPE and PP yearly.

In June 2023, TotalEnergies launched a new high-density polyethylene (HDPE) resin for applications that facilitated reduced material utilization, improved material recovery, and recycling. The new HDPE 20HD07 resins have improved mechanical and organoleptic qualities resulting in the decreased carbon footprint of final applications, such as cosmetic bottles or beverages. Additionally, it is designed for mono-material polyethylene packaging solutions to simplify sorting and recycling and thereby support the circular economy.

In May 2023, Texplore, an SCG Chemicals subsidiary, and Lummus Technology, a global provider of value-driven energy solutions and process technologies, signed a commercial partnership agreement to license and market Texplore's EXCENE HDPE technology. While Texplore would offer its EL-Cat catalyst, Lummus will provide engineering design for the building of the plant as well as services for commissioning and startup.

In February 2023, Aberdeen was selected as the second location by Bulldog Pipe to set up their manufacturing site. The company leased an existing vacant 60,000-square-foot industrial building, invested approximately USD 2.7 million, and has committed to creating 26 new full-time jobs in the Aberdeen plant with an average salary of USD 50,675 in the first year. 

List of Key Suppliers

• Borealis AG
• Lotte Chemical Corporation
• The Dow Chemical Company
• PetroChina Company Limited
• Abu Dhabi Polymers Company Limited
• Formosa Plastics Corporation
• Exxon Mobil Corporation
• LyondellBasell Industries N.V.
• SCG Chemicals Public Company Limited
• INEOS AG 

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HDPE Procurement Intelligence Report Scope

• HDPE Category Growth Rate : CAGR of 4.45% from 2023 to 2030
• Pricing Growth Outlook : 2% - 4% (Monthly)
• Pricing Models : Cost plus pricing model, volume-based pricing model
• Supplier Selection Scope : Cost and pricing, past engagements, productivity, geographical presence
• Supplier Selection Criteria : By type, packaging options, operating capability, durability, quality measures, technology, certifications, regulatory compliance, and others
• Report Coverage : Revenue forecast, supplier ranking, supplier positioning matrix, emerging technology, pricing models, cost structure, competitive landscape, growth factors, trends, engagement, and operating model 

Brief about Pipeline by Grand View Research:

A smart and effective supply chain is essential for growth in any organization. Pipeline division at Grand View Research provides detailed insights on every aspect of supply chain, which helps in efficient procurement decisions. 

Our services include (not limited to):

• Market Intelligence involving – market size and forecast, growth factors, and driving trends
• Price and Cost Intelligence – pricing models adopted for the category, total cost of ownerships
• Supplier Intelligence – rich insight on supplier landscape, and identifies suppliers who are dominating, emerging, lounging, and specializing
• Sourcing / Procurement Intelligence – best practices followed in the industry, identifying standard KPIs and SLAs, peer analysis, negotiation strategies to be utilized with the suppliers, and best suited countries for sourcing to minimize supply chain disruptions