Asian ethylene prices tank to over three month lows

16-Jul-15

In Asia, spot ethylene prices continued to decrease, which was triggered by the end of the heavy maintenance season in the region and intensified by discouraging polyethylene demand, according to ChemOrbis. This week, spot ethylene costs hit a new low and nearly reached levels seen at the beginning of April. Since the beginning of the month, spot ethylene prices are down by US$150/ton on CFR Northeast Asia basis and down by US$185/ton on CFR Southeast Asia basis. The Southeast Asian ethylene market appears to be weaker since most producers operating in this region are reportedly covered for August. Meanwhile, on the Dalian Commodity Exchange, September LLDPE futures plummeted by CNY430/ton (US$60/ton) between July 1 and July 15 while the trading volumes shrank by 200,376 tons during the same time frame. Overall demand remains weak for ethylene and supplies were reported to be improving. Starting from mid-May and during June, many crackers were restarted in Asia including Samsung Total, BASF-YPC, Dushanzi Petrochemical, Idemitsu Kosan, Mitsubishi Chemicals and YNCC. Apart from these restarts, PE supplies from Middle Eastern producers are not as tight as before. Middle Eastern producers mostly approached China with lower PE prices for July, according to ChemOrbis.