US ethylene margins down slightly but remain near all-time highs

John Dietrich

18-Aug-2014

HOUSTON (ICIS)–US ethylene margins fell slightly week on week for the week ended 15 August, the ICIS margin report showed, but remained near record highs.

US ethylene margins for ethane-based spot material were at 59.90 cents/lb ($1,321/tonne), down 1.1% from the previous week’s assessment at 60.54 cents/lb.

The previous week’s ethylene margins were the highest recorded, but the spot price component was based on bids and offers reported during that week, as no trades were done, leading to a wider range than normal.

For the week ended 15 August, ethylene spot prices narrowed, falling an average of 0.75 cents/lb week on week, but settling at steady market levels.

For the week ended 1 August, ethylene margins were at 60.23 cents/lb, which set a record high.

Ethylene margins have been peaking on cheap feedstock ethane and high spot prices because of several cracker outages and production issues throughout the second and third quarter.

US spot ethane prices for the week ended 15 August fell to 9.82 cents/lb from 9.98 cents/lb the previous week, further boosting ethylene margins.

US cracker co-product credits fell during that time, to 3.96 cents/lb from 4.02 cents/lb, leading margins lower.

US front-month spot ethylene for August traded at 66.5 cents/lb on Monday, its fourth consecutive deal at that level.

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