03 August 2012 18:03 [Source: ICIS news]
HOUSTON (ICIS)--US butadiene (BD) prices will rise in the long term as a result of the shift to light cracking based on cost-advantaged ethane from shale gas, the chief executive of TPC Group said on Friday.
“While the long-term trend is for pricing to move up, butadiene can also exhibit short-term volatility as we've seen over the past several years,” said Michael McDonald, CEO of TPC Group.
For example, McDonald said BD prices increased 49% in the first quarter, then fell 26% and another 16% between June and July.
“These trends will continue until on-purpose production becomes a significant factor in supply,” he said. “Currently BD supply is driven by ethylene plant operating rates and the composition of feed slates. Demand is driven by end-use demand for synthetic rubber, nylon and other products that require [BD]. [BD] is also difficult and expensive to store, exacerbating short-term supply/demand imbalances and resulting in price swings.”
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.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|
Asian Chemical Connections