US ethylene margins increase 2.5% on rising spot values

HOUSTON (ICIS)–US ethylene margins rose 2.5% week on week for the week ended 24 April, the ICIS margin report showed on Monday.

Margins for ethane-based spot ethylene rose to 29.26 cents/lb ($645/tonne), up from 28.55 cents/lb the previous week.

Most of the increase stemmed from an increase in spot pricing, which followed global energy markets higher.

Additionally, domestic and export demand is showing signs of climbing on seasonal factors and higher overseas prices in derivative markets.

The rise in global energy boosted other US commodities, which led ethane cracker co-product credits up to 2.59 cents/lb from 2.48 cents/lb, further boosting ethylene margins.

However, higher energy prices and more demand for ethylene pushed up on feedstock ethane costs, which rose to 7.77 cents/lb from 7.43 cents/lb, slowing down margin growth.

On Monday, US front-month April ethylene was bid at 35.0 cents/lb and offered at 36.5 cents/lb, trending higher as a Texas cracker reported an unplanned shutdown.