US Apr EO contracts up 1.0% on ethylene increase

NEW YORK (ICIS)–US ethylene oxide (EO) contract prices for April rose by 1.0% on the back of a 2.5% raise in feedstock ethylene contracts for April, as assessed by ICIS on Friday.

April EO contract prices were assessed at 53.40-62.90 cents/lb ($1,177-1,387/tonne) FOB (free on board) from 52.80-62.30 cents/lb FOB in March.

The slight increase in EO contracts is based on the settlement in April ethylene contracts.

US ethylene contracts settled at 30.50 cents/lb DEL (delivered), a 0.75 cents/lb increase from 29.75 cents/lb in March.

The majority of EO contracts are formula-based, and price movement comprises 80% of the change in the ethylene price and an additional conversion fee, or adder.

Like ethylene, EO contracts settle at the beginning of the month for the previous month’s price.

Meanwhile, EO supply is said to be available again because Indorama Ventures lifted its force majeure on purified EO and monoethylene glycol (MEG) on 15 April, according to market sources.

The company restarted its Clear Lake, Texas, plant in early April after a prolonged outage due to a reactor issue, sources said.

EO is largely used to make MEG, a key feedstock for polyethylene terephthalate (PET). EO’s secondary outlet is in surfactants.

Other EO derivatives include glycol ethers, polyols for polyurethane systems, polyethylene glycols and polyalkylene glycols.

EO producers in the US include BASF, Dow Chemical, Eastman, Huntsman, Indorama Ventures, LyondellBasell and Shell Chemical.