US PE margins slip on higher ethane costs

HOUSTON (ICIS)–US polyethylene (PE) margins slipped during the week on higher feedstock ethane costs, the ICIS Margin Report showed on Tuesday.

Integrated PE contract margins for ethane slipped by 0.08 cent/ lb ($1.76/tonne) as ethane costs rose 2.0% and outweighed a 3.6% increase in coproduct credits.

March PE contract margins were revised higher following the higher PE March contract settlements.

March average PE margins increased about 3.36 cents/lb above the February average. First-quarter average margins remain around 2.82 cents/lb below those in the fourth quarter of 2015.

The profit margin for low density (LDPE) was 74.7%, and 70.3% for high density (HDPE), based on data in the report. Those percentages have slipped a little in Q1 this year, down by 0.8% for LDPE and 1.1% lower for HDPE.