02 February 2012 21:12 [Source: ICIS news]
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HOUSTON (ICIS)--US ethylene contracts for January settled at 55.75 cents/lb ($1,229/tonne, €934/tonne), up by 1 cent/lb from December, market sources said on Thursday.
The 1.8% increase was fuelled by a jump in spot prices, which more than offset a reduction in production costs last month.
Ethylene spot prices in January averaged 58.75 cents/lb, rising from 51.07 cents/lb in December.
The increase was driven by tightening supply amid the start of a busy cracker turnaround season in the US.
The scheduled shutdowns, combined with some minor unplanned outages, have dampened demand for ethane, the price of which averaged 66.77 cents/gal in January, down from 80.66 cents/gal in December.
Ethane accounts for around 60% of the feedstocks used in the US ethylene industry.
US ethylene contracts usually settle at the beginning of the month for the previous calendar month.
Major US ethylene producers include Chevron Phillips Chemical, ExxonMobil, INEOS, LyondellBasell and Shell Chemicals.
Buyers include Dow Chemical, Georgia Gulf, Occidental Chemical and Total.Follow William on Twitter
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