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 2021
Regional supply rose as capacity expansions outweighed turnarounds and production issues. New crackers totalling over 4m tonnes/year in capacity started commercial operations in China and southeast Asia between February and May. This boosted supply in the regional merchant market and negated the impact of scheduled maintenance and production glitches at facilities in South Korea and Japan. Capacity losses in the two countries were at an estimated 245,000 tonnes in Q2.
China’s import demand growth was capped by rising domestic supply and weaker downstream margins. While there continued to be capacity expansions at standalone plants in China, exporters faced increased competition from the local producers. The Chinese domestic supply was boosted by new capacity as well as delays in integrated downstream start-ups and production issues. Weak downstream margins on the back of increased domestic capacity and tepid end-use demand also led to production cuts at some standalone units.
Planned cracker maintenance turnarounds were underway in Q2. Most have now been completed although not without some restart delays. Several unexpected hiccups impacted on cracker output especially in May, and there continues to be some reductions due to technical issues. The tight balance and ongoing scheduled outages saw spot prices maintained above contract reference price. Imports from the US started to make their presence felt on the back of a wide-open arbitrage.
Underlying demand remained robust across all ethylene derivative sectors throughout Q2, but in some cases there was a perception that the ceiling had been reached and inexorable price rises could not continue. Planned and unplanned derivative production issues reduced ethylene consumption from time to time leading to some unexpected ethylene supply length. Supply chain challenges also impacted some derivatives’ production. Inventory levels across the chains stayed low.
Supply has loosened steadily since the beginning of Q2, with producers still in recovery from widespread disruptions caused in February by winter storm Uri. Planned and unplanned cracker outages slowed the process of re-balancing the market, but higher run rates and rising inventories late in the quarter offset rising feedstock costs. Supply of feedstock natural gas liquids (NGLs), supported by increased drilling activity, remained ample to meet demand.
Consumption of ethylene derivatives remained strong through Q2 amid easing coronavirus-related restrictions and a broad economic recovery. Downstream producers’ efforts to re-stock inventories following disruptions caused by Q1’s winter storm Uri amplified demand for ethylene. Elevated US pricing to begin the quarter curbed demand from overseas; however, loosening supply progressively supported export opportunities.
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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