Europe PE margins rise week on week on the back of higher co-product credits

Author: Miguel Rodriguez Fernandez

2020/07/08

LONDON (ICIS)--Producers of polyethylene (PE) in Europe saw their margins increase week on week on the back of higher co-products values, ICIS margin analysis showed on Wednesday.

Increasing ethylene prices weighed on standalone operators, forcing margins down.

In the week to 3 July:

- Naphtha values rose by more than 2%

- LPG values fell by more than 3%

High density polyethylene (HDPE) contract margins soared by nearly 9%, co-product credits rose:LPG-based HDPE contract margins increased by 12%.

Low density polyethylene (LDPE) contract margins went up by 7%, co-product credits were up slightly:

LPG-based LDPE contract margins increased by 10%.

HDPE spot margins by feedstock:
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LDPE spot margins by feedstock:

In the week to 3 July, PE demand remained steady while supply length was reduced as technical problems eased, although some tightness remained for LDPE.

For most grades, there is still no shortage of supply.

Prices remained largely unchanged, except for linear low density polyethylene (LLDPE), which saw a small rise as fewer imports shortened supply.

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