February IPEX rises on strong US performance

05 February 2014 11:10  [Source: ICIS news]

IPEXLONDON (ICIS)--A month of up and down petrochemical prices resulted in February’s ICIS Petrochemical Index (IPEX) rising 0.7% from the revised January figure of 334.81*.

The US sub-index saw a 2.0% rise and was the best performer across aromatics, olefins and polymers. The biggest improver in the US was benzene, with a 7.9% rise in prices, leading to a 2.6% rise in the US aromatics sub-index.

This was despite toluene being the worst performer in the region, as prices fell by 1.9%. Benzene prices were at their highest for a year, amid continued tight supply, delayed shipments and production issues.

Meanwhile, toluene prices were down because of a lack of demand from the gasoline sector, as the recent cold snap kept motorists away from the pumps.

Polypropylene (PP) was another significant contributor to the gains in the US. Monthly average prices grew by $110/tonne to an 11-month high, leading to a 1.7% improvement in the US polymer sub-index. Polystyrene (PS) prices also strengthened, by 1.9%, following the rise in benzene feedstock costs.

The European sub-index grew by only 0.8%, with all but three of the components of the 12 petrochemical IPEX product basket registering marginally higher values. A stronger dollar limited gains for the month.

The greatest increase was in the aromatics sub-index, which rose by 1.7%, with benzene leading the way as monthly average prices rose by 3.0% in dollar terms.

The smallest growth this month was in the Asian sub-index, as it was held back by a poor performance in the polymers sub-index, which fell by 0.9%. Polyethylene (PE) prices and PP prices dropped by 2.5% and 1.3% respectively.

The olefins sub-index supported Asia’s growth, with ethylene being the main contributor as average prices strengthened by 5.8% on the previous month.

The growth in ethylene prices was aided by reduced domestic China production, with the permanent closure of Shanghai Petrochemical’s cracker at the end of November last year and BASF-YPC’s cracker in Nanjing, Jiangsu being shut for minor repairs.

Published at the beginning of each month, the IPEX provides an independent indicator of average change in world petrochemical prices.

The IPEX product basket of 12 essential petrochemical products comprises ethylene, propylene, benzene, toluene, paraxylene (PX), styrene, methanol, butadiene (BD), polyvinyl chloride (PVC), PE, PP and PS.

Dating back to January 1993, historical ICIS prices for these products in the US, western Europe and northeast Asian markets have been weighted by regional nameplate capacity to generate the monthly index value.

*The January IPEX has been revised from 334.22 to 334.81 following the December contract settlements for ethylene and styrene in the US. February's index will also be subject to revision once the January ethylene, styrene and PVC contracts settle in the US and the January styrene contract settles in Asia.

IPEX February 2014

The revised historical IPEX data is available from ICIS on request.

For a full methodology of the revised IPEX, click here.

By: James Ball

By: Staff Reporter
+44 20 8652 3214

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ICIS Global Petrochemical Index (IPEX)
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