Europe December ethylene contract confirmed up €22.50/tonne

LONDON (ICIS)–The European ethylene  December contract price has been fully confirmed at €927.50/tonne, up €22.50/tonne from November, following second buyer and seller support on Monday despite some seller discontent at the level of increase.

An initial contract settlement had been reached on Monday morning as “a compromise” in the price position of the first settling buyer and seller.

However, some sellers have been reluctant to follow the initial settlement, because they considered the level of increase to be too low.

One supplier said it considered plus €30/tonne to be more acceptable. There was also some talk that sellers considered a minimum of €25/tonne to be realistic.

However, a second seller and a second buyer followed the initial settlement later after some delay, in order to “unblock the situation”, said one of the settlers.

The second settling buyer said it agreed with the initial number, with the second seller adding that it was “reluctantly but honourably [agreed] on their [the second seller’s] part”.

The contract price is fully confirmed once support is received from two separate buyers and two separate sellers, which has now been the case. It was agreed on a free delivered (FD) northwest Europe (NWE) basis.

The upward movement was linked to tight supply at the moment, according to the first buyer, which said it was likely to ease during December, once the Shell Moerdijk cracker in the Netherlands restarts.