US LDPE margins fall by 0.19% on rise in ethane

HOUSTON (ICIS)–US polyethylene (PE) margins for low density polyethylene (LDPE) fell by 0.19% weak over week for the week ended 10 January, following a rise in feedstock costs, the ICIS margin report showed on Monday.

Integrated domestic PE margins were assessed at 67.57 cents/lb ($1,490/tonne) for LDPE and 58.29 cents/lb for high density polyethylene (HDPE) blow moulding, a 0.13 cent/lb decrease on average for LDPE and 0.14 cent/lb decrease on average for HDPE from a week earlier, using ethane as a feedstock.

December and January-to-date standalone contract margins have been revised downward following the higher settlement of the December ethylene contract price.

The PE margin decreased based on a 1.2% rise in ethane feedstock costs and a 1.0% fall in co-product credits. Co-product credits fell on lower C4 and pygas values. Energy costs fell.

Co-product credits are the price at which products such as propylene, butadiene (BD) and benzene, which are made along with ethylene in the cracking process, can be sold.

Integrated export margins increased by around 0.79 cents/lb, as higher spot PE prices outweighed lower co-product credits.