US Nov EO contracts down 6.8% on ethylene decrease

HOUSTON (ICIS)–US ethylene oxide (EO) contract prices for November fell by 6.8% on the back of a 14.8% decrease in feedstock ethylene contracts for November, as assessed by ICIS on Friday.

November EO contract prices were assessed at 53.20-62.70 cents/lb ($1,173-1,382/tonne) FOB (free on board) from 57.40-66.90 cents/lb FOB in October.

The decrease in EO contracts is based on the settlement in November ethylene contracts.

US ethylene contracts settled at 30.25 cents/lb DEL (delivered), a 5.25 cent/lb decrease from 35.50 cents/lb in October.

The majority of EO contracts are formula-based, and price movement comprises 80% of the change in the ethylene price and an additional conversion fee, or adder.

Like ethylene, EO contracts settle at the beginning of the month for the previous month’s price.

EO is largely used to make monoethylene glycol (MEG), a key feedstock for polyethylene terephthalate (PET). EO’s secondary outlet is in surfactants.

Other EO derivatives include glycol ethers, polyols for polyurethane systems, polyethylene glycols and polyalkylene glycols.

EO producers in the US include BASF, Dow Chemical, Eastman, Huntsman, Indorama Ventures, LyondellBasell and Shell Chemical.