Significant increase in spot ethylene in Asia on the back of tight supplies

13-Apr-15

In Asia, spot ethylene prices have been recording significant increases on the back of tight supplies, owing to the plant shutdowns in the region, many of which began April and are expected to last until June-July, according to ChemOrbis. According to Asian players, spot ethylene prices were US$75/ton higher on CFR Northeast Asia basis and US$40/ton firmer on CFR Southeast Asia basis from early April levels at the end of last week. When compared with early March levels the increases are even larger at over US$300/ton and as high as US$380/ton. These hefty increases were attributed to supply concerns in Asia. There are several plant shutdowns in the region, according to ChemOrbis. LG Chem’s 900,000 tpa cracker located in Daesan, South Korea was shut by mid-March for annual maintenance, and is expected to restart by April 19, according to initial plans. Meanwhile, Samsung Total’s 700,000 tpa cracker in South Korea is also to go under a maintenance shutdown, in line with their polyolefin units, in April. The shutdown is planned to take around 40 days. BASF-YPC’s 740,000 tpa Nanjing cracker in China will also be shut for two months of maintenance, starting in April. Japan’s Idemitsu Kosan is mulling a shutdown of its 374,000 tpa cracker for about two and a half months, to resume operations by around June. Mitsubishi Chemical is to shut its 495,000 tpa cracker located in Japan by H2-May for a month long turnaround and expansion work. Formosa, meanwhile, is to shut their 700,000 tpa Mailio cracker on June 9 for a turnaround. However, the duration of the shutdown has not been disclosed, by the time of publishing. Mitsui Chemicals is to shut the 600,000 tpa Chiba cracker in Japan for 45 days by mid-June. CPC is also mulling over shutting their 380,000 tpa Taiwanese cracker, located in Linyuan for 60 days in Q4-2015.