Commodity chems should continue price run in January – analyst

Source: ICIS News


HOUSTON (ICIS)--Prices for commodity chemicals should continue rising in January because of high oil prices, cold weather in the US and tight supplies.

Prices and margins should rise for acetic acid, methyl di-p-phenylene isocyanate (MDI), methyl tertiary butyl ether (MTBE), propylene and caustic soda, according to Vertical Research Partners.

Prices and margins should fall for polyethylene (PE), Vertical said. Producers have started up new plants, and ethane prices have risen, although they are doing so from a low level.

For ethylene, prices should remain steady and margins should fall.

Prices and margins should remain steady for ethylene dichloride (EDC), polypropylene (PP), polyvinyl chloride (PVC) and chlorine, Vertical said.

Vertical highlighted several trends that were affecting individual products.

For caustic soda, chlor-alkali producers throughout the state of Louisiana faced logistical challenges shipping the material because of freezing temperatures.

For PE, several trends could help stabilise prices, Vertical said.

Downstream inventories are relatively low. Rising oil prices could encourage companies to buy resin now instead of later. Recent plant outages could also put pressure on prices. Demand remains strong, and the ban on recycled plastic from China could create another opportunity for US exporters, Vertical said.