US Oct PE contracts increase by 3 cents/lb amid lingering supply tightness

27 October 2017 21:47 Source:ICIS News

HOUSTON (ICIS)--US polyethylene (PE) contracts for October were assessed higher on Friday, as lingering tightness following Hurricane Harvey kept supply constrained throughout the month.

Source: Dinendra Haria/REX/Shutterstock

ICIS raised its contract assessments by 3 cents/lb ($66/tonne) as sellers’ initial offerings were broadly accepted by the market.

The assessments put October contracts for linear low density polyethylene (LLDPE) butene (c4) film at 84-86 cents/lb, high density polyethylene (HDPE) blow moulding at 84-86 cents/lb and low density polyethylene (LDPE) liner grade at 92-94 cents/lb, all on a delivered US in bulk basis.

No firm indications have emerged regarding November pricing yet, although several sources commented that the market may be plateauing as supply is gradually improving as the impacts of Hurricane Harvey fade.

LyondellBasell announced that it will lift its force majeure from its Matagorda, LaPorte, Victoria and Chocolate Bayou sites in Texas as of 1 November. The company had declared force majeure from the plants on 28 August following Harvey’s landfall on the US Gulf Coast.

Additionally, Chevron Phillips Chemical (CP Chem) has begun to restart its Cedar Bayou, Texas facility, with executives from Phillips 66 stating that the complex will be fully operational by mid-November. The company has already restarted its 1-hexene unit and is aiming to restart the cracker at the site by mid-November and the PE units by early December.

Additionally, ExxonMobil started one of its two new PE units in Mont Belvieu, Texas last week, while company executives said in an earnings call the start-up of the second line is imminent.

By Zachary Moore