23 February 2010 15:16 [Source: ICIS news]
LONDON (ICIS news)--An initial Europe March ethylene (C2) contract has rolled over at €940/tonne ($1,288/tonne) due to a flat-to-firmer outlook resulting from unexpected supply issues and expectations that upstream levels will remain firm, a major producer said on Tuesday.
The contract, which was fully confirmed and agreed and on a free delivered (FD) northwest Europe (NWE) basis, was between the producer and one of its customers, a major polyvinyl chloride (PVC) producer.
“Last week, maybe it was possible to do a better level, even though the resistance [to a decrease] was strong,” said the PVC producer, referring to early speculation that ethylene contracts would see a reduction.
However, upstream expectations had firmed because of ongoing refinery strikes in ?xml:namespace>
In addition, the ethylene supply and demand balance was looking a little uncertain because of possible cracker problems
Moreover, the PVC producer said that a decrease would not have been a good signal to the market.
“[PVC] prices have just started to pick up a little…Is a reduction good for downstream activities?” asked the PVC producer.
($1 = €0.73)
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