Europe has fixed the first export of ethylene for the year, as per Platts. A 4,500 ton cargo of ethylene was loaded in early January for delivery from Tarragona in Spain to El Tablazo, Venezuela. FOB price levels are at Eur 900/mt (US$1149/mt) and higher. Current inland values are over Eur 1000/mt FD Northwest Europe.
Input costs have risen amid underutilized cracker capacities. Cracker margins -- for both spot and contract volumes -- remained in the red this week, though they have retreated from the historic lows of Friday. Contract cracker margins were assessed at minus Eur 140/mt that day, with spot cracker margins at minus Eur 414/mt.
While ethylene prices have gained momentum since the beginning of the year, sources in the NWE market have expressed concerns that structural demand remains week. Sluggish demand has driven Europe, a traditional net importer of ethylene, to become a net exporter since September. Maintenance work at the Houston terminal, which generally serves the Venezuelan ethylene market, also helped create an export opportunity for European producers. Inland prices have been feeling further upward pressure this week on account of a depreciating euro.