In the last few days, Asian ethylene spot prices have risen to 16-month high's, mainly due to tight supply from Asia and the Middle East, as well as price increases in its raw material; naphtha as well as crude oil.
Naphtha supply shortage led to large-scale crackers in Asia to reduce operating rate to about 90 percent, which helped promote prices of downstream products like polyethylene and MEG.
However, tight supply of ethylene in the spot markets greatly hindered market trade. A number of sellers suspended sales on anticipation of further price, though a few offers for cargos were available US $1,300-1,350 per ton (CFR Asia).
But rising price of ethylene may lead to production cut in downstream plants; integrated producers may in turn sell vinyl cargo. There was an explosion in a cracker in China Lanzhou Petrochemical Company, though it did not have a direct impact on the market.
In downstream derivatives market, price of high-density polyethylene (film grade material) rose US $50-80 to US $1,270-1,360 / ton (CFR China), while MEG price was US $970-980 / ton (CFR China). Styrene price rose US $80-90 to US $1,300-1,320 / ton (CFR China). PVC price rose US $30 to US $930-970 / ton (CFR China).
Fibre2fashion News Desk - India