Ethylene Dichloride Prices Expected to Maintain a Firm Trend in the USA
- 26-Nov-2021 5:06 PM
- Journalist: Bob Duffler
The prices of Ethylene Dichloride (EDC) have been on a growth trajectory for the past two months in the USA and the prices are expected to maintain a bullish run as the regional demand remains high as the demand from downstream sectors is increasing on the back of a growing construction sector which is reviving from the lockdown constraints. The prices of EDC were assessed at USD 850 per tonne in September. The prices have been rising since then with the prices reaching a high of USD 900 per tonne in the starting of October. The prices in the month of November this week were assessed to be USD 960 per tonne.
The prices are expected to keep quoting higher as the demand for downstream vinyl chloride monomer which is the feedstock for polyvinyl chloride is increasing in the USA with the rise in the demand for construction sector. The buying activity is also up with the inventory levels being low which has put an extra pressure on the supplies.
The prices are expected to rise by around 2%-5% in the upcoming week given that the supply is expected to remain tight on the back of growing demand for EDC. The prices will tend to stabilize once the inventory levels reach optimum levels.
EDC is a colourless liquid with a chloroform like odour. It is produced through the catalytic reaction of ethene (ethylene) and chlorine via one of two processes which include direct chlorination using pure Chlorine and Ethylene or oxychlorination in which Ethylene reacts with Chlorine in hydrogen chloride medium. More than 90% of EDC produced globally, is used in the manufacture of vinyl chloride monomer, which is the key feedstock used in polyvinyl chloride production. The global demand for EDC stood at around 50 million tonnes in 2020 and is expected to grow at a CAGR of around 3.8% during the upcoming years till 2030.
As per ChemAnalyst, “the prices of EDC which have been rising for the past two months in the USA are expected to maintain a growth trend and will possibly reach the USD 980-985 per tonne levels this upcoming week. The demand for downstream PVC sector is growing in the USA with the growth of the construction sector. This growth in the demand of PVC industry is expected to keep the prices high in the medium term.