January IPEX falls by 17%, nears five-year low

06 January 2009 19:27  [Source: ICIS news]

January IPEX falls 17%HOUSTON (ICIS news)--The ICIS Petrochemical Index (IPEX) fell by 17% for January to 175.96, its lowest level since April 2004.

The January fall was the second-largest month-over-month decline in the 16-year history of the IPEX index, after the December plunge of 27%.

The global economic downturn continued to undermine demand and pricing for petrochemicals and has forced several producers to implement massive layoffs and production cutbacks.

Prices for all 12 products in the IPEX portfolio fell. Amid low demand and ample supply, the biggest losers were styrene, which fell by 33%, and methanol, which dropped by 32%.

Other significant global declines were for paraxylene (PX), down by 26%, and polystyrene (PS) and butadiene (BD), both down 23%.

Although pricing weakness prevailed in most regions, ethylene and propylene prices both rose by 20% in Asia due to tighter supply. But that was offset by a 28% slump in the US due to declining demand and feedstock prices.

Published at the beginning of each month, the IPEX provides an independent indicator of average change in world petrochemical prices.

Dating back to January 1993, historical ICIS prices for a basket of 12 essential petrochemical grades in the US, western Europe and the northeast Asian markets have been weighted by regional nameplate capacity to generate a monthly index value.

The IPEX product basket comprises ethylene, propylene, benzene, toluene, PX, styrene, methanol, BD, polyvinyl chloride (PVC), polyethylene (PE), polypropylene (PP) and PS.

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By: Larry Terry
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