Spot ethylene prices gained ground in Asia and USA over the past week on the strength of limited supply, as US ethylene prices find additional support from healthy demand inside the country, as per Chemorbis. Meanwhile, spot prices moved lower in Europe as the availability of Asian and Middle Eastern cargoes weighed down on buying interest.
In the US, spot deals for ethylene were reported towards the end of last week at prices approximately US$40-90/ton higher when compared with the bid-offer range from the previous week, bringing spot ethylene prices to their highest levels since last spring. Stronger ethane feedstock costs, healthy ethylene demand and limited availability within the country were cited as some of the main reasons for the rise in prices.
In Asia, spot ethylene prices on a CFR Northeast Asia basis gained US$10/ton at the start of this week after remaining unchanged over the past week. The spot ethylene market lacked clear direction for most of last week as players attempted to assess the likely impact of the March 11 earthquake in Japan. Prices moved higher at the start of this week on expectation that ethylene supplies will shorten over the near term as Japan’s operational refineries are likely to use their naphtha supplies for gasoline rather than petrochemical production to ease the gasoline shortages affecting quake hit regions. Firmer spot naphtha prices amid recent news that Shell has declared force majeure at its 800,000 tpa cracker in Singapore has exerted additional upward pressure on the market, several sources speculate that the coming days would see a more pronounced run-up in spot ethylene prices.
Meanwhile, spot ethylene prices lost ground in Europe over the past week, as ongoing availability from Asian and Middle Eastern sources exerted some downward pressure on spot prices. Spot ethylene prices on an FD NWE basis slipped €45/ton last week on rising supplies and sluggish demand. Several buyers reported that they have already covered their needs from the spot market for this month and therefore are in no mood to make further purchases. For now, most players are tracking the ongoing ramifications of the March 11 earthquake in Japan as well as the ongoing political turmoil in the Middle East in order to get a clearer idea of the likely direction of the market.