August IPEX slides to January levels but Europe bucks the trend

03 August 2010 16:38  [Source: ICIS news]

LONDON (ICIS news)--The ICIS Petrochemical Index (IPEX) for August fell for the third consecutive month, returning to January 2010 levels.

The 2.1% fall to 256.75 from a revised* July figure of 262.15 was the result of a continued weakening of prices, particularly in Asia and the US.

The decline would have been much steeper but for Europe, which significantly bucked the trend, though largely because of the weaker dollar versus euro exchange rate.

Prices fell in northeast Asia for all products in the IPEX basket on ample supply and cautious buying sentiment. Prices also declined for the majority of products in the US, the only exceptions being propylene and methanol, which settled at rollover values, and butadiene, which rose by 2.2% on tight domestic supply. The northeast Asian component of the index fell by 4.7% and the US component by 2.7%.

In Europe, only butadiene, polyvinyl chloride (PVC) and methanol prices rose in euro terms, but prices firmed in dollar terms for all but the aromatics products. A 16% hike in euro-denominated butadiene contract pricing due to supply constraints, strong export demand and a sustained strong European polymers market provided the greatest boosts to the index. The European component of the index increased by 4.2%.

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 products in the US, western Europe and 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, paraxylene, styrene, methanol, butadiene, PVC, polyethylene (PE), polypropylene (PP) and polystyrene (PS).

The July IPEX has been revised from 262.75 to 262.15, following incorporation of the US June ethylene contract settlement. This month’s index is also subject to revision once the US July ethylene and US and Asian July styrene contracts settle.

*As of July 2010, the index has been revised retrospectively to replace latest available contract prices at the time of publication that had previously been used in the data series with actual settled contract prices. This has had the effect of moving the derived IPEX index from an estimated status to an actual status.

The revised historical IPEX data is available from ICIS on request
Click here for a full methodology of the revised IPEX
To discuss issues facing the chemical industry go to ICIS connect

By: Susan Royse
+44 20 8652 3214

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.

Printer Friendly