28 May 2013 16:44 [Source: ICIS news]
HOUSTON (ICIS)--US ethylene margins fell by 8.7% for the week that ended on 24 May, tracking a fall in spot prices, the ICIS margin report showed on Tuesday.
US ethylene margins for ethane-based spot material fell to 47.66 cents/lb ($1,051/tonne, €809/tonne), down from the previous week’s level of 52.22 cents/lb.
The drop puts ethylene margins below 50 cents/lb for the third time in the past four weeks. Prior to this downswing, margins had not reached this level in 2013.
Most of the decline in margins can be attributed to weaker spot prices. Spot prices fell by 3.250-5.125 cents/lb for the week that ended on 24 May, mostly on weaker demand.
The weakness in demand has offset several planned and unplanned cracker outages that have tightened supply in the market.
However, several restarts last week improved supply and boosted ethane prices to 12.41 cents/lb from 12.09 cents/lb a week ago, further eroding margins.
Additionally, ethylene margins were pushed lower by weaker cracker co-product values, which fell to 4.31 cents/lb from 4.36 cents/lb a week earlier.
US ethylene for May was heard offered at 57 cents/lb on Tuesday against no fresh offers.
($1 = €0.77)
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