Ethylene Prices in Europe are Firm, Expected to Dip in the Coming Weeks
- Journalist: Robert Hume
Ethylene prices have maintained their firm position in the European market as demand remains robust due to moderately high consumption levels from all the key sectors. Supply fundamentals have also gained balanced with enhanced production rates.
During the first quarter, Ethylene supplies remained tight due to unplanned, short lived cracker issues along with ongoing outages that took place in Sweden and UK. Some eases could be seen after Borealis’ 625 KTPA Stenungsund cracker in Sweden came back online in January-end to kickstart the rebound of supply in the market.
Since then, the demand has remained healthy as all key derivatives measured a significant increase in consumption levels. Lockdown restrictions appeared to have no negative impact on demand for Ethylene. Spot availability for Ethylene was measured at very low levels as market participants were keen on maximizing contractual volumes.
Spot price of ethylene after the 3rd week of May was assessed at USD 1075 per MT on FD basis in North Western Europe.
Market sentiments have been strong for Ethylene and players expect buying to peak in June-August window where both demand and supply could be seen in a stronger position. However, improved cracker operating rates and anticipated slag in demand may tip the scales in favor of supply which is likely to result in softening of prices in the coming weeks.