23 April 2014 22:40 [Source: ICIS news]
HOUSTON (ICIS)--US spot ethylene prices jumped on Wednesday after several transactions as buyers got aggressive ahead of the planned restart of the Evangeline Pipeline.
US front-month April ethylene ended Wednesday at 56.25 cents/lb ($1,240/tonne) after trading at 55.25 cents/lb and 55.75 cents/lb earlier in the day.
Before Wednesday, spot ethylene traded three times at 54 cents/lb on 21 April.
“It’s hard to know why prices are going up,” a market source said. “It’s mostly traders doing the buying.”
Demand for ethylene is expected to climb in May and June as the Evangeline Pipeline is restarted, allowing for more material to move into Louisiana.
Sources said they are still expecting a mid-May restart of the pipeline.
However, sources said that sellers in Texas should have ample inventories to sell or transfer into Louisiana, so aggressive buying now makes little sense.
“Houston is awash in ethylene,” another source said. “No one is short material.”
Sources said they expect US ethylene spot prices to reach their 2014 peak in May, as supply will increase in May and June on several restarted crackers, some of which will have expanded capacity.
The rise in April spot ethylene also hit May spot ethylene, which traded at 56.5 cents/lb on Wednesday compared with 55.0 cents/lb the previous day.
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