Asian ethylene prices shrug off crude rally
According to the weekly average data from ChemOrbis Price Wizard, spot ethylene costs dropped by $45/ton on CFR Far East Asia basis during the last two weeks. On the other hand, WTI crude oil futures on NYMEX and Brent crude are still hovering at the highest levels of 3 years, the data revealed.
Some non-integrated PE producers across Asia either lowered their operating rates or halted production citing their melting margins, which has been blamed as the main trigger behind reduced buying appetite towards ethylene. Prior to the recent losses in ethylene prices, the market reached their highest levels since June 2015 owing to a relentless rally in the past two and a half months.
The recent fall in ethylene has also defied the bullish trend in the downstream PE market, which hit multi-year highs in January, particularly for HDPE film amidst tightness and healthy demand ahead of New Year Holidays. Now, spot ethylene costs have come on a par with China’s import HDPE film market following the recent losses in prices, according to the weekly average data from ChemOrbis Price Wizard.
Some players also pointed to the nearing turnaround season for styrene, saying that the planned shutdowns may also reduce ethylene consumption further at the time.
Although some traders across Asia are worried about improved supplies and reduced buying appetite for ethylene, there are also others who argue that the market may rebound for March business considering the planned shutdowns at some steam crackers and delayed restarts. The constant strength of the energy complex may also prop ethylene prices up, they say.
More free plastics newsPlastic resin (PP, LDPE, LLDPE ,HDPE, PVC, GPS; HIPS, PET, ABS) prices, polymer market trends, and more...
- Turkey’s PP and PE markets propelled to a firm start to H2 despite vulnerable conditions
- Asian PVC sees V-shaped recovery in Q2, what will Q3 bring?
- Will capacity additions cast cloud on ethylene upsurge in Asia?
- US PVC offers in Egypt rise steadily but resistance grows in tandem
- PE buyers’ resistance grows in SEA; duty-free origins more competitive than Mid-East
- Polymer demand cools in Turkey: Is price correction ahead for PP, PE and PVC?
- China’s rising PET trend takes a pause, but longer-term outlook remains firm
- Uptrend in China’s import PP market continues but cautious mood returns
- Hikes in Asia July PVC offers baffle some buyers, further rally under discussion
- Optimism is rising on resurgent demand in European polymer markets