Better prices in Europe tempt ethylene from Middle East, US away from Asia

26-Jul-10

Better prices for ethylene in Europe are luring Middle Eastern and US cargoes away from Asia. As per Platts, South East Asian ethylene spot prices have stayed flat at US$797/mt CFR in the past week, while North Western Europe prices were at US$944/mt CIF. There is no demand for ethylene in Southeast Asia, as the region remains oversupplied with Middle Eastern cargoes. Marubeni is reported to have sold 4,500 tons of ethylene from Rabigh, Saudi Arabia, for early July loading to a destination in Europe. Western trader Centrotrade has also fixed a 4,500 tons of spot cargo from Bandar Imam Khomeini, Iran, for early-August loading to Europe. Mitsubishi has sold 6,000-7,000 tons of spot ethylene from Houston to Europe for loading July 26-28. Another 4,500 ton spot cargo was heard to be available from Iran's Bandar Imam Khomeini for end-July loading. Normally, spot cargoes from the Middle East are sold to Southeast Asia due to better logistics such as storage tanks and discharging terminals, while some end-users in Europe do not have logistics to take the large-sized (5,000-6,000 ton) Middle Eastern cargoes.