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Viability of naphtha crackers face question mark
15 Jun '10
1 min read
Ethylene prices are bottoming out since the last few days, which is creating jitters amongst the ethylene producers. Ethylene prices have touched a seven-month low of US $930-950 per ton in the previous week.
According to experts, in all probability, naphtha crackers may start reducing operating rates if ethylene price trends continue on their downward journey. According to them there is a situation of oversupply with limited storage capacity.
Currently a few naphtha crackers are undergoing maintenance in Japan and once they are fully operational, they will be an over supply of ethylene, which might lead to many naphtha crackers cutting production capacities.
Naphtha crackers in Asia had been running at high operating rates of 90-100% in the first half of this year due to robust margins of more than $400 per ton, but the sharp ethylene price slump since second half of May had eroded their earnings.
According to experts, in all probability, naphtha crackers may start reducing operating rates if ethylene price trends continue on their downward journey. According to them there is a situation of oversupply with limited storage capacity.
Currently a few naphtha crackers are undergoing maintenance in Japan and once they are fully operational, they will be an over supply of ethylene, which might lead to many naphtha crackers cutting production capacities.
Naphtha crackers in Asia had been running at high operating rates of 90-100% in the first half of this year due to robust margins of more than $400 per ton, but the sharp ethylene price slump since second half of May had eroded their earnings.
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