US LDPE margins fall by 5.2% on higher feedstock costs

27 January 2014 17:23  [Source: ICIS news]

HOUSTON (ICIS)--US polyethylene (PE) margins for low density polyethylene (LDPE) fell by 5.2%, following a 25% rise in feedstock costs, the ICIS margin report showed on Mondy.

Integrated domestic PE margins were assessed at 63.12 cents/lb ($1,392/tonne) for LDPE and 53.82 cents/lb for high density polyethylene (HDPE) blow moulding in the week that ended on 24 January. That represents a 3.44 cent/lb decrease on average for LDPE and  HDPE, from a week earlier, using ethane as a feedstock.

Margins fell as ethane costs rose by 7.65 cents/gal to their highest level since August 2012. Co-product credits slipped by 1.2%, on slightly lower crude C4 values, while energy costs rose by 3.8%. Margins are at their weakest since the end of May 2013.

Co-product credits are the price at which products such as propylene, butadiene (BD) and benzene, which are made along with ethylene in the cracking process, can be sold.

Integrated PE export margins weakened by 3.43 cents/lb on the higher feedstock costs and slightly lower co-product credits.

By: Michelle Klump
+1 713 525 2653

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