March IPEX climbs further, highest since September 2008

01 March 2011 16:07  [Source: ICIS news]

LONDON (ICIS)--The ICIS Petrochemical Index (IPEX) for March has climbed further to 336.84, the highest since September 2008.

The IPEX figure saw an improvement of 5.4 % from its revised* February figure of 319.48 on firmer global chemical prices.

Firmer prices resulted from higher crude values and strong demand as well as reduced outputs, mainly in Europe and the US due to several cracker outages.

A panic-buying attitude, triggered by the escalating political turmoil in North Africa and the Middle East, has caused spot Asian chemical prices to soar.

This month, the European component of the index plays the leading role in the IPEX improvement, increasing by 7.0% from last month’s figure. A 1.8% weakening of the dollar exchange rate against the euro combined with higher prices have promoted the strengthening of the European component. The benzene contract saw the greatest price hike, climbing to €1,001/tonne ($1,390/tonne).

The US index component rose by 3.6%. Paraxylene (PX) was the main contributor, with a $265/tonne increase, the greatest price hike of all 36 IPEX basket products. Only the methanol contract saw a decline, following a drop in spot prices.

The Asian component of the index grew by 5.7%. PX prices, which climbed by $240/tonne on tight supply, had the greatest impact. Polyethylene (PE) was the only product to record a decline, by an average of $14/tonne, holding back growth of the Asian component.

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, PX, styrene, methanol, butadiene, polyvinyl chloride (PVC), PE, polypropylene (PP) and polystyrene (PS).

The February IPEX has been revised from 318.74 to 319.48, following incorporation of the US January ethylene and styrene and the Asian styrene contract settlements. This month’s index is also subject to revision once the US February ethylene and styrene and the Asian styrene contract prices settle.

($1 = €0.72)

*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

Author: Alexandra Sukanegara

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