18 September 2009 06:06 [Source: ICIS news]
By Peh Soo Hwee
SINGAPORE (ICIS news)--Northeast Asian ethylene spot prices fell below the psychological barrier of $900/tonne (€612/tonne) to three-month lows on Friday as demand from China weakened amid ample regional supplies, industry players said.
Concerns over further declines in key ethylene derivatives also shook the market, leading some traders to trim offers for the monomer by more than $50/tonne this week, they added.
The polyethylene (PE) market held up ethylene prices for most of the year.
A regional 2,300-3,000 tonne ethylene spot cargo for first-half October arrival into Taiwan was heard sold at $880-890/tonne (€598-605/tonne) CFR (cost and freight). These were levels not seen since late June 2009, according to data from global chemical market intelligence service ICIS pricing.
Discussions for high-density PE film grade into ?xml:namespace>
“There is a lot of (ethylene) surplus in the northeast and no demand from
The start-up of Fujian Petrochemical’s new 800,000 tonne/year naphtha cracker in Quanzhou, southern
The lack of spot demand from China has left traders with limited outlets for sale, at a time when Japan has some spot cargo surplus due to derivative plant turnarounds in September-October and high cracker run rates of close to 100% this month, they said.
“Derivative demand is decreasing in
“There should be more ethylene to sell from
Japanese producers may come under pressure to cut cracker rates in the fourth quarter – bringing an end to five months of high run rates – as margins were being squeezed by firm naphtha feedstock values and weakening olefins prices, including for propylene, which fell below $1,000/tonne CFR NE Asia this week.
“Cracker operators in
Other producers in northeast
A 5,500 tonne ethylene cargo for loading in the first half of October to
The north-south arbitrage had opened up in late August due to the wide gap of around $100/tonne between the two regions.
Ethylene had risen sharply in southeast Asia partly because of tight supply from
Discussion levels, however, have started to decline this month due to weakening PE markets, which was fuelling expectations that ethylene prices would come under further pressure.
October offers/selling ideas fell $30/tonne this week to $1,050-1,060/tonne CFR SE Asia but were countered by buying ideas at $1,000-1,020/tonne CFR SE Asia, traders said.
With additional reporting by Chow Bee Lin
($1 = €0.68)
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|
Asian Chemical Connections