US ethylene margins plunge 17% in the week to lowest in three years

21-Jan-15

US ethylene margins hit their lowest in three years, falling by 17% during the week ended 16 January, as per ICIS. Margins for ethane-based spot material fell to 28.74 cents/lb (US$634/ton), down from 34.47 cents/lb the previous week. This is the lowest margins have been since sitting at 26.65 cents/lb during the week ended 6 January 2012, which is also the previous time margins fell below the 30. cent/lb level. Spot margins have been plummeting on falls in spot prices, which hit their lowest since October 2010 on lengthening supply and weak demand. The weak demand is mostly the result of intense competition in several downstream markets as the US feedstock advantage has been largely erased by low global oil and energy prices. During the week ended 16 January, spot ethylene prices shed an average of 5 cents/lb.