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 Q3 2020
The quarter started on a weaker note due to easing tight supply, following the restart of key exporters’ facilities in Japan and the arrival of over 150,000 tonnes of US cargoes between mid-July and early September. The market rebounded from early September as supply tightened once again. Product for October delivery was in short supply ahead of maintenance shutdowns at regional facilities, and due to a closed US-Asia arbitrage and strong PE operations.
Restocking activities in China were supported by trial runs at new downstream projects and tight domestic supply, amid a turnaround at key supplier SP Olefins’ cracker. South Korea’s spot demand was boosted by increased PE operations, as well as upcoming cracker turnarounds and downstream capacity expansion. Thailand’s demand also grew in preparation for a shutdown at Map Ta Phut Olefins’ cracker in early November to mid-December.
Ethylene supply was ample throughout Q3. Numerous but short-lived cracker outages, together with scheduled maintenance and the long running outage at the cracker in Sweden, helped to offset planned and unplanned issues at the derivative level. Prompt availability was a little tighter than expected in August because of a concentration of issues and high-temperature restrictions in some areas resulting in slightly higher spot prices, but supply soon reverted to normal.
Demand picked up in the construction sector and even the automotive sector started to show some improvements through Q3. Packaging sector demand fell back and PE demand was described as disappointing in August and September. On the whole, derivative markets remained quite cautious, buying on a need-to basis amid a lack of visibility down the value chains.
Cracker outages, both caused by and unrelated to Hurricane Laura, curbed Q3 US ethylene production. At the close of Q3, around 20% of US ethylene capacity was still offline. Upstream, supply of US ethane, ethylene’s primary feedstock, defied initial fears of a shortage triggered by reductions in US crude oil and natural gas output. US crude production, while down from the prior year, remained very high by historical standards, keeping the ethane market adequately supplied.
Unexpectedly buoyant demand in certain sectors drove a V-shaped for US ethylene in Q3. Exports reached record-high volumes, driven by a healthy arbitrage to Asia and enabled by the new Enterprise Products terminal in Texas. Demand in principal derivative PE, which also saw strong export performance, proved pandemic-resistant as a result of a growing global packaging market.
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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