Ethylene trough to end by early 2011 - Liveris

03 August 2010 22:17  [Source: ICIS news]

HOUSTON (ICIS)--The ethylene trough will likely end by the early part of 2011 as fewer plants come on line and the global economy continues to grow, Dow Chemical chief executive Andrew Liveris said on Tuesday.

Liveris made his comments during an earnings conference call.

Overall, ethylene margins would likely shrink in the second half of this year, although by a smaller amount than initially expected, Liveris said.

New capacity was not starting up as quickly as some had expected, he said. Moreover, unplanned outages would continue.

At the same time, growth in the global economy was expected to beat earlier estimates, he said.

Also, demand for polyethylene (PE) was growing, as indicated by statistics such as lower inventories, Liveris said. In addition, US shale gas could provide the industry with cheap feedstock.

"We could see profitability in the polyethylene business decline by only $150m [€114m] in the third quarter," Liveris said. "Our polyethylene business will enter peak margin territory over the next few years."

($1 = €0.76)

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By: Al Greenwood
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