HOUSTON (ICIS)--US October ethylene contracts reached a full settlement down 2.2%, sources confirmed on Friday.
US October ethylene contracts shed 1 cent/lb ($22/tonne, €16/tonne) to move to 45 cents/lb.
The settlement was in line with market expectations after October spot prices hit a 16-month low on long supply.
October spot ethylene was done at an average of 45-46 cents/lb on the benchmark Williams System, its lowest since being done at an average of 42-43 cents/lb in June 2012.
This was largely because of long supply in the Williams System in Texas owing to continued difficulties with the Evangeline Pipeline.
With the pipeline operating at below-desired rates, several US ethylene producers in Texas were unable to move material to their preferred destinations in Louisiana.
Although Texas spot ethylene prices fell, spot prices in Louisiana’s Choctaw System rose, mitigating the fall for ethylene contracts.
US ethylene contracts typically settle at the start of the month for the previous month.
Major US ethylene producers include Chevron Phillips Chemical, ExxonMobil, INEOS, LyondellBasell and Shell Chemical.
Major US buyers include Axiall, Dow Chemical, Occidental Chemical and Total.
($1 = €0.74)