Ethylene, propylene contracts expected higher for February
In Europe, a number of crackers are expected to undergo simultaneous maintenance turnarounds in the February-May period. According to market sources, producers have already started to build stocks ahead of the imminent turnarounds while derivative producers needed to run their plants at high rates to meet local demand due to a lack of import material, which is another reason reducing supply levels.
February propylene and ethylene contracts are expected to settle higher due to the abovementioned factors with a distributor in Germany saying, “For February, we expect increases of around €40-50/ton on propylene contracts while modest increases of €20-30/ton are likely to pass on ethylene contracts amid tightening supplies and strong upstream costs.”
Spot ethylene prices rose around €30/ton since the beginning of January while propylene prices posted larger hikes of around €90/ton during the same period. A different distributor from Italy noted, “We think that the PE market is under a softer pressure than the PP market.”
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