Stop Negotiating. Start Securing. The PP Shortage Has Changed the Rules.
Your supplier has less polypropylene than you need. What happens next depends entirely on you!
The global polypropylene market has entered a supply crisis unlike anything seen in recent years. The US-Iran conflict and escalating Middle East war have created a genuine, structural shock across polymer-producing regions. ChemOrbis is reporting that PP markets in China, India, and Southeast Asia have all surged to multi-year highs, driven by tightening supply and sharply higher upstream costs. The numbers from India tell the story plainly — published Reliance Industries ex-works prices for standard raffia homopolymer moved from approximately $1,266/MT on 15 February 2026 to $1,817/MT by 11 March 2026 — a confirmed increase of over 43% in 24 days, based on documented producer price schedules. Depot grades saw even sharper moves, with some locations recording increases exceeding 50% over the same period. Saudi Advanced Petrochemicals has simultaneously imposed a $300/ton logistics surcharge on all export shipments from March 1, citing war risk premiums, marine insurance increases, and deteriorating freight conditions. These costs are already in transit toward Mombasa.
The price increases are significant. But the price is not the real problem. The real problem is that supply is running out — and not everyone will be able to get it.
This is a supplier’s market. It will remain so for the next 12 to 18 months.
Understand what that phrase means in practice:
- In a buyer’s market, suppliers compete for your order. They offer discounts, extend credit, absorb freight, and negotiate.
- In a supplier’s market, the supplier decides who gets material. They have a fixed, constrained allocation — less than total demand — and they distribute it to the customers they choose to serve.
That second market is where we are now. And you have no negotiating power. As the Middle East situation continues and oil prices remain elevated, this constraint will not ease quickly. Every month that passes without a resolution tightens the supply picture further. New production capacity cannot be built or commissioned in months. The feedstock chain — crude oil → naphtha → propylene → PP resin — is disrupted at multiple points simultaneously.
This is not a short-term price spike that corrects in a quarter. Buyers who plan on the assumption that prices will normalise by mid-year are making a structurally incorrect bet. The prudent assumption is that constrained supply and elevated pricing persist through 2026 and into 2027 — and that as the situation continues, availability will become more restricted, not less.
When every supplier has a shortage, they stop selling — and start choosing
Polymer producers and distributors at every level of the chain — from Saudi and Indian resin manufacturers down to local converters — are now working from constrained allocations. They have less material than the market demands, and they are deciding, methodically, which customers receive it. The criteria are not complicated:
- Who pays on time — overdue accounts are deprioritised immediately
- Who accepts market-reflective pricing without extended standoffs or demands for justification
- Who provides reliable forward volume visibility — confirmed orders, not last-minute spot requests
- Who has maintained the relationship through normal markets, not just called when they need something urgently
Customers who have built that track record get served. Everyone else gets a polite explanation about availability. ChemOrbis notes that sellers across Southeast Asia and the Middle East have already begun withdrawing offers and rationing supply. This is not temporary friction — it is a structural shift in how the market operates. In Kenya and East Africa, manufacturers with established supplier relationships, clean payment records, and confirmed forward demand are being prioritised first. The buyers who are struggling to secure material right now are, almost without exception, the ones who spent the last two years treating procurement as a price negotiation rather than a supply relationship.
Accepting the price increase is not a concession. It is the condition of supply.
This is the point that matters most, and the one most buyers are getting wrong. These tactics do not work in a supplier’s market — they make your situation worse:
- Pushing back on price increases and demanding justification
- Seeking competitive offers to use as leverage against your existing supplier
- Delaying payment while waiting for the market to soften
- Holding purchase orders hoping prices will drop
A supplier managing limited allocation will not reward a difficult buyer with better pricing. They will redirect that material to a customer who accepted the increase without a standoff. The price increase is coming regardless. It is already in the upstream data. It is documented in published price schedules from the world’s largest PP producers. The only variable is whether your supplier prioritises your orders or someone else’s.
Your supplier has less PP than you need right now. That is the reality. Which means the leverage you think you have in a negotiation — walking away, going elsewhere, waiting them out — does not exist. Walk away, and the material goes to the next buyer on the list. Go elsewhere, and you will find every other supplier in the same constrained position, at the same price or higher. Wait it out, and your production line stops while someone else’s keeps running.
There is no supplier in this market with excess stock sitting idle at a discount. Any offer significantly below prevailing levels should be treated with deep scepticism — it likely reflects substandard grade, unreliable supply, or a counterparty who will not be able to fulfil when the order is placed.
The second-order effects are only beginning
When buyers who were slow to act finally enter the market in volume — and they will — prices will move again. Panic purchasing by unprepared buyers creates artificial demand spikes that push pricing further above already elevated fundamentals. Suppliers managing constrained supply become more selective under pressure, not more accommodating. Lead times extend — not because production has stopped, but because every available tonne is already committed weeks in advance.
Companies that delayed order confirmation are now looking at extended delivery timelines and prices higher than what buyers who acted in early March secured. That gap widens every week. The window to confirm Q2 and Q3 packaging volumes at current price levels is closing. Buyers who engage their supplier now, accept the market reality, and lock in forward supply will be in a fundamentally stronger position than those who are still negotiating in May.
What should you do now?
- Confirm your volumes — contact your packaging supplier today and put April through June requirements in writing
- Clear outstanding invoices — your position on an allocation list is directly tied to your payment record; overdue accounts get deprioritised first
- Accept current pricing — your supplier’s costs are documented and verifiable; pushing back does not reduce them, it reduces your priority
- Stop shopping around — every supplier is short; a significantly lower offer elsewhere is a red flag, not an opportunity
- Plan for 12 to 18 months of this — this market will not normalise quickly; build your procurement strategy around that reality, not the assumption of a correction
If you would like to discuss how current market conditions affect your packaging requirements, contact the Adpack team — we are monitoring the market closely and are here to help you plan.
Sources: ChemOrbis – Saudi Advanced seeks $300/ton logistics surcharge on exports amid war-related shipping costs (12 March 2026); ChemOrbis PP Analysis – China, India, Southeast Asia (March 2026); Reliance Industries PP Pricing Schedule 2025-26/PP/DTA/034 (11 March 2026) vs. 2025-26/PP/DTA/029 (15 February 2026). USD conversion at prevailing INR/USD exchange rate of 83.5.