In Asia, spot ethylene prices have risen by US$50/ton over the past two weeks led by both higher crude oil prices plus unexpected outages at regional crackers, as per Chemorbis. However, spot propylene has moved up twice as fast, rising US$110/ton over the two week period. Propylene has seen a greater incline due to the number of propylene plants affected by outages. Similar to the US, spot propylene prices in Asia have traded at higher prices relative to spot ethylene prices. Despite the recent increase in ethylene, prices for this monomer are nearly US$300/ton below spot propylene prices in the region.
Spot ethylene prices in USA traded within a narrow range throughout most of July before heading higher. The US spot ethylene market increased by around US$100/ton in the last trading days of July and maintained its firm trend at the start of August. Done deals peaked last week before moving lower in the last few days after news that Dow would be restarting its cracker at Freeport, Texas. Despite the dramatic rise, spot ethylene has yet to draw closer to spot propylene level which saw a similar trend of rising in the last week of July and first week of August. As a result, there remains a considerable gap between the two monomers with spot propylene approximately US$450-460/ton above spot ethylene. The same gaps are seen in the contract market. Propylene contracts stood US$353/ton above ethylene contracts in the month of June. For July, propylene rolled over while ethylene contracts remain unsettled yet, but players were previously discussing decreases of US$44-55/ton for the ethylene figures which would create a bigger gap of US$397-408/ton. Meanwhile, in August, propylene contracts have begun to settle at even higher levels after reports that increases of US$44/ton have started to push through in settlements. While the spot ethylene market was affected by news of outages at Chevron Phillips and Dow’s Freeport cracker in July, propylene has been disproportionately affected due to crackers in the country using lighter feedstocks which produce less propylene than the heavier feeds.
The European monomer market has bucked the trend with spot ethylene trading nearly €30/ton above propylene while both monomers have seen prices rising since the end of July. However, in the contract market both monomers settled at the exact same level for the month of August at €940/ton for both ethylene and propylene.