Spot ethylene, propylene lose ground ahead of Feb contracts in Europe
For ethylene, spot prices on an FD NWE basis dropped by around €40/ton at the end of last week after holding largely steady since the beginning of the month in spite of plunging energy costs at the time. Crude oil prices, which traded below $30/barrel last week, as well as muted buying interest in the region were cited as the main reasons behind lower ethylene prices.
Players are projecting a lower ethylene settlement for the approaching month, with their initial expectations calling for decreases from €40/ton to €80/ton with respect to January. This week, a distributor in Italy reported that he expects February ethylene contracts to settle around €70-80/ton lower.
Spot propylene prices registered a larger decrease compared to ethylene, plunging by around €65/ton as of the end of last week. The recent drop in propylene costs was attributed to weak spot naphtha prices, which were below $300/ton at the time before edging up in tandem with the recent gains in crude.
Similar to ethylene, propylene contracts are also awaited lower for February. Some players in Italy voiced their expectations of seeing reductions between €30/ton and €50/ton on the awaited propylene contracts.
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