Spot ethylene prices posted significant gains in Asia over the past week, with players citing limited supply issues as the primary factor supporting prices, as per ChemOrbis. Limited supply also pushed up the low end of the spot range in Europe. In the US, loosening supply pushed spot ethylene prices lower, although the US ethylene contract for November settled with an increase owing to firmer feedstock costs earlier in the past month.
In Asia, spot ethylene prices posted significant week over week increases after hovering at mostly steady levels for the first three weeks of November. Concerns over possible supply limitations were cited as the main reason for the rise in prices, which has brought spot ethylene prices on a CFR Northeast Asia basis to their highest levels since late September. Trading activity is said to be limited in the market as buyers and sellers are far apart in their price ideas, with sources adding that the upward momentum in the ethylene market has slowed down over the past few days as buyers felt that last week’s price increases have pushed spot quotes to unreasonably high levels given persistently sluggish derivative demand.
In Europe, spot ethylene prices moved slightly higher on the low end of the range over the past week as cracker operators reported to clear the market of excess ethylene through a combination of export sales and operating rate reductions. Cracker operators admitted that spot demand remained weak in the region, adding that they are carefully managing their stock levels for now and are mostly focusing on producing just enough to cover their contractual commitments. The December ethylene contract settled with a decrease from November last week, with players pointing to month over month decreases in naphtha costs as well as sluggish demand as the main reasons for the drop in the December contract price.
In the US, spot ethylene prices softened week over week as several crackers which had been taken off-line towards the end of November returned to production over the past week. Sources also pointed to softer ethane feedstock costs as another factor weighing down on spot ethylene prices. The US ethylene contract for November settled at the beginning of this week with increases from October based on firmer ethane costs in the first half of November.