US ethylene for Nov settles 4% lower at 45.25 cents/lb

04 December 2012 22:01  [Source: ICIS news]

US ethylene for Nov settles 4% lower at 45.25 cents/lb(adds details throughout)

HOUSTON (ICIS)--US ethylene contracts for November dropped by 2 cents/lb ($44/tonne, €34/tonne), market sources said on Tuesday, confirming that a full-market settlement had been reached.

The 4% reduction, which came amid lower feedstock and ethylene spot prices in November, puts the contract at 45.25 cents/lb.

US ethylene contracts normally settle at the beginning of the month for the previous month.

The monthly contract had been expected to drop as a result of lower spot prices and reduced ethane costs last month.

US ethylene in November traded at an average of 53.11 cents/lb, down from 55.45 cents/lb in October, while ethane prices fell to 28.96 cents/gal from 32.18 cents/gal in the previous month.

The drop in ethylene prices stems from weaker demand, whereas ethane prices have softened on supply pressure and also as a result of softer demand.

Ethane accounts for around 60% of the feedstocks used to make ethylene in the US.

The feedstock traded down to 24 cents/gal on Tuesday, hitting another all-time low as inventories remain at historic high levels.

December ethylene traded at 50.75 cents/lb earlier in the day, on the low end of deals done at 50.625-51.750 cents/lb last week.

($1 = €0.77)

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By: William Lemos
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