US front-month spot ethylene moved to record highs at the end of the previous week, tracking tight supply and low inventories. Sources said front-month September material was done twice on Friday at 76.5 cents/lb (US$1687/ton), the highest price recorded in the ICIS database. The previous record high was 76.125 cents/lb, done during the week ended 13 April 2012. The record high prices in the benchmark Williams System stem from current production issues and low inventories.
Sources said that almost 10% of US ethylene capacity is down because of three cracker shutdowns, with almost 14% set to be down in October when several planned turnarounds hit. “The alarming number is that we have averaged 12% of the capacity being down from March to October,” a US ethylene buyer said. “That’s staggering.” The buyer said that high ethylene prices have pushed it to lower its operating rates to bare contractual necessities. “We’re not making a pound more than we need to,” the buyer said. “It’s bad business to be in the spot market.” Sources said that the tight supply and low inventory levels could keep prices strong well into November and December, when capacity is expected to return.
22-Sep-14 
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