How to Read Plastic Raw Material Price Indices

A price index is a periodic (generally weekly) reference price indicator compiled from market transactions or conversations with market participants for a specific material (e.g. European PP homopolymer injection grade). Organizations such as ICIS, Platts or PAGEV publish these kinds of indices; some offer a free summary, others detailed data requiring a paid subscription.

An index shows the general trend and average level in the market — but the actual transaction price can deviate noticeably from the index depending on quantity, payment terms, delivery method (Incoterm), the customer relationship, and the supply-demand situation at that moment. For this reason, an index's stated 'level' is not a guarantee of the quote any given supplier will offer you.

Spot price is the price set for a one-off transaction based on current market conditions and is the most exposed to fluctuation. Contract price is agreed in advance for a specific period, generally based on a formula (e.g. tied to a reference index), and gives the buyer more predictability for budgeting (see the related term).

Index data is useful for tracking the market's general direction (upward/downward trend) — for example, it can guide a decision on whether to bring a purchase forward. But for an exact price valid specifically for you, you should always get a current quote; we recommend not treating an index figure you see on our site or any third-party source as a direct offer.