ICIS Ethylene price reports are covered weekly in Asia, Europe and US and also daily in Asia. Reports include analysis and market intelligence on contract and spot prices, margins, production issues, upstream and downstream news and any other influencing factor that is impacting price movements at that given time. In addition to weekly reports there are also margin reports for each region.
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Updated to Q2 2019
Supply was long following widespread cuts in downstream monoethylene glycol (MEG) production. Major MEG makers in Asia and the Middle East offloaded a substantial quantity of ethylene after lowering derivative output in response to weak margins and poor Chinese demand. Exports from southeast Asia and Japan were boosted by downstream turnarounds and technical issues, helping to offset a decline in shipments from South Korea where cracker operations were curtailed by turnarounds and production issues.
China’s spot requirements were low in April due to production issues, safety inspection following a fatal industrial accident and weak conditions in certain downstream sectors. Buying interest improved later in the quarter, boosted by restocking activity after a long holiday in early May and better margins for many derivatives as ethylene spot prices tumbled to decade-lows in June. MEG makers with standalone plants in Asia reduced their ethylene offtakes due to poor market conditions.
Planned cracker maintenance got under way from mid-April, albeit a little slower than planned at Shell’s Netherlands cracker because of strike action. Together with unplanned outages, this led to a tightening of ethylene supply and spot prices steadily rose. Europe’s high cost position relative to the US and Asia saw good availability in terms of imports, although logistics issues hampered some trade. By the end of the quarter, turnarounds were ending.
Preparations to cover outages were sufficient for most consumers and spot activity was limited. Core demand for the key polymer sector held steady throughout, although gains in upstream markets did lead to a boost in some areas. Affordability amid rising spot numbers was cited as an issue for incremental purchases. Some derivative sectors fared worse and there were a number of planned outages on derivative units.
US ethylene supplies tightened in Q2 as ExxonMobil and BASF Total underwent planned maintenance that lasted the entire quarter. Three new crackers that were expected on line – Indorama, Lotte/Westlake and Shintech – had yet to begin operations. Indorama and Lotte/Westlake started, but had trouble with on-spec material. Bad weather caused several brief outages at major crackers. Despite the supply constraints, ethylene inventories remained at record highs and were more than ample to meet domestic demand needs.
US ethylene demand was lacklustre in Q2 on the back of a dim economic outlook and trade war tensions with China, which impacted most major ethylene derivatives markets. Demand slowed, notably in June. Q2 was likely the peak of demand for 2019. Supply levels were more than ample to meet poor demand. Conditions pushed spot ethylene prices lower through the quarter as supply outpaced demand and feedstock costs continued to decline.
We offer the following regional Ethylene analysis and news coverage to keep you informed of factors and developments affecting prices in the Ethylene marketplace.
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Ethylene is the starting point for so many chemicals that have such an impact on our daily lives from polyethylene (PE) used in packaging, pipes through to ethylene glycol (EG) used in polyester and antifreeze.
Europe’s ethylene landscape has been more fluid and dynamic over the past two years than ever before. The advent of low oil prices in Q4 2014 led to record cracker margins, strong demand, and increased operating rates, which in turn was considered a factor in the unprecedented number of production problems in 2015.
Prices usually track crude oil and naphtha market developments very closely but the supply and demand situation can play a large part in determining contract and spot prices because of the challenges inherent in producing, transporting and consuming a gas.
European contract prices hit a bottom of €810/tonne in March 2016 but have been on a steady uptrend for the most part since then, gaining 16% largely on the back of a string of planned – and sometimes unplanned – cracker production issues.
European spot price developments over the past year have been tumultuous, falling about 21% in the first quarter, rising again by almost 30%, and then settling back as supply has eased
Ethylene is a colourless, odourless, extremely flammable compressed gas. It is slightly soluble in water and soluble in liquid hydrocarbons. It reacts with strong oxidants causing fire and is anexplosion hazard..
Ethylene Asia Margin Report Methodology
This document is intended to provide methodology support for customers receiving the ICIS Weekly Margin – Ethylene Asia report.
Ethylene China Margin Report Methodology
This document is intended to provide methodology support for customers receiving the ICIS Weekly Margin – Ethylene China report.
Ethylene Europe Margin Report Methodology
This document is intended to provide methodology support for customers receiving the ICIS Weekly Margin –Ethylene Europe report.
Ethylene US Margin Report Methodology
The main method of ethylene manufacture is by the thermal cracking of hydrocarbons. Both gaseous and liquid hydrocarbon feedstocks are used in the US, so this report examines two typical models.
Ethylene is a colourless, odourless, extremely flammable compressed gas with a faintly pleasant odour. It is slightly soluble in water and soluble in liquid hydrocarbons. It reacts with strong oxidants causing fire and explosion hazard.
Ethylene is mainly used to make polyethylene (PE). Low density polyethylene (LDPE) and linear low density polyethylene (LLDPE) mainly go into film applications such as food and non-food packaging, shrink and stretch film, and non-packaging uses. High density polyethylene (HDPE) is used primarily in blow moulding and injection moulding applications such as containers, drums, household goods, caps and pallets. HDPE can also be extruded into pipes for water, gas and irrigation, and film for refuse sacks, carrier bags and industrial lining.
Other major uses are ethylene oxide (EO), ethylene glycol (EG), vinyl chloride monomer (VCM) for polyvinyl chloride (PVC) and styrene.
Other derivatives include linear alpha olefins (LAO), detergent alcohols and plasticiser alcohols, vinyl acetate monomer (VAM), and various intermediates such as ethyl acetate and ethyl acrylate.
Ethylene is produced commercially by the steam cracking of a wide range of hydrocarbon feedstocks.
In Europe and Asia, ethylene is obtained mainly from cracking naphtha, gasoil and condensates. The cracking of ethane and propane is primarily carried out in the US, Canada and the Middle East.
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