For the Quarter Ending June 2022
North America
In this quarter, the price of Ethylene Dichloride surged with accelerating demand from downstream Vinyl Chloride Monomer (VCM) and the PVC market. Major producers' overall output of Chlor-alkali and other products will remain tight through most of Q2 2022 because of extended production and power outages in the regional market. The outage further tightens the supply of feedstock ethylene and Chlorine, impacting the market sentiments. The downstream PVC market also remained under limited supply and low operating rates among the manufacturing units. We see pricing momentum continuing with high freight and transportation costs. However, exports from the US to Asian and European Nations slipped due to the bearish demand for the product from overseas suppliers.
Asia Pacific region
In Q2 2022, the prices of Ethylene Dichloride in the Asian market reduced with succeeding months due to affected purchasing appetite and muted market fundamentals. With fluctuations in crude and Naphtha values, the price of Ethylene also declined in the region owing to weak demand and deterred market sentiments. Feedstock Ethylene offers in India have crashed, taking down the costs of downstream PVC due to rising supplies and low purchasing activities affecting the price trend. Narrowed supply and demand gap resulted in the stabilized price movement for Ethylene Dichloride as bearish buying sentiments were witnessed amongst the domestic buyers in India.
Europe
In Q2 2022, the prices of Ethylene Dichloride slipped in the second half of the quarter after touching their peak in April. However, inflationary tensions and overheated resin costs, most elevated across the board, pushed European EDC purchasers to the sidelines, which has overburdened venders' previous intentions to clutch their proposals in May, considering decreased EDC supplies. Loosening demand seems to have been the critical driver of softening as obstruction has mounted given inflated levels and purchasers limit buys to their earnest necessities. The downstream PVC market cooled down in June because of reducing feedstock Ethylene and Chlorine prices. Notwithstanding, the costs stayed on the upper end; however, speeding up operating rates and facilitating local interest loosened the cost.
For the Quarter Ending March 2022
North America
The prices increased with the beginning of the quarter, but the slope was slipped in the quarter end due to deterred feedstock ethylene and chlorine market. Exports to Asian and African regions also reduced due to oversupplies and stockpiling of product in these regions which reduced the prices of EDC. However, the prices of the product started to surge towards the end of the quarter due to major turnarounds which impacted the price trend. In USA, the price of Ethylene Dichloride towards the starting of the first quarter was USD 925/ton FOB USGC.
Asia Pacific
In India, the price of Ethylene Dichloride reduced when compared with previous quarter due to slipping feedstock Ethylene and Chlorine market. However, the market sentiments improved in the month of March and prices rose due to strong downstream market. Feedstock Ethylene prices marched high with improved product demand on the back of constrained product availability in the region. On the top of that, the demand of Ethylene Dichloride in the region surged supported by price gain. Upstream crude oil prices also jumped in the Asian market due to accelerating tension between Ukraine and Russia. In India, the price of Ethylene Dichloride towards the quarter end were observed to be USD 788/ton CFR Mundra. Downstream PVC market remained on the lower end with deterred construction sector and high inventories among the enterprises.
Europe
In European market, the price of Ethylene Dichloride surged with rising tension between Russia and Ukraine. Spot prices increased, and major plant turnaround kept the prices on the upper end. Feedstock Ethylene and Chloride prices also increased with strong market sentiments and insufficient product availability. Crippling product availability in the domestic market increased the prices. However, logistics constraints and surged transportation cost created hurdle to export the product to the Netherlands and Spain. In Germany, the price of Ethylene Dichloride towards the start of the quarter were observed to be USD 1052/ton FD Hamburg. In terms of inventories, they were on the lower end with squeezed profit affecting the sales and revenue of the downstream derivative market.
For the Quarter Ending December 2021
North America
In Q4, the prices were observed to be high with strong demand compared with Q2 and Q3 and convalesce downstream market. The prices touched their height on 26 Nov in Germany where the prices were hovering in the range of $928/ton-$991/ton FOB USGC. Various factors drive EDC demand in the US market especially supply demand fundamentals and production cost. Robust downstream PVC market also gave boost to the prices. Feedstock Ethylene and Chlorine prices were also surged majorly due to Hurricane Ida which affected most of the Chlor alkali production in US Gulf coast. Imminent increase in PVC capacities in US gave more scope for domestic demand and also seek opportunity in tight export market.
Asia Pacific
Asia Pacific region witnessed high demand from chemical water treatment and PVC market in Q4 compared with Q2 and Q3. In October, RIL has committed to establishing a chemical manufacturing unit in Abu Dhabi to generate 940,000 MTPA Chlor-Alkali, 1.1 MMTPA, Ethylene Dichloride (EDC) and 360,000 MTPA Polyvinyl Chloride (PVC) facility. December prices of EDC slipped compared to other two months due to $945/ton Ex-Chennai with the declination of 9.80% where the prices in October were observed to be $1047/ton Ex-Chennai. In November, upstream Ethylene and Chlorine both have been trading lower on falling crude futures and pressured pricing environment across Asia compared to other producing regions. Market sentiments remained dampened on low PVC demand and ample stocks with the local traders.
Europe
European EDC market remained on the higher side with increment in demand with each month in Q4 and also compared to previous quarters. Demand remained robust but the supply was limited. Major Chlor alkali producer companies had introduced surcharge on their products in the face of spiralling gas and electricity cost. Feedstock Ethylene and Benzene faced degree of tightness producers had shifted from negotiation mechanism and rather increased the prices due to limited availability and higher production cost. Downstream PVC had also steadily grown, and the market balance remain firm, despite the rise in effective capacities in this quarter.
For the Quarter Ending September 2021
North America
In Q3 2021, Ethylene Dichloride (EDC) market observed an upward pricing trend in the North American region. The upsurge in the values of Ethylene Dichloride was supported by its constraint availability amidst sturdy demand from the downstream Vinyl Chloride and other segments. Volatility in the prices of upstream Ethylene also sent ripples to the EDC prices during this time frame. The industrial infrastructure in the US Gulf coast remained offline because of the arrival of the Ida hurricane that unbalanced the demand and the supply of EDC during the timeframe. For instance, force majeure was declared by Westside Chemical on its two PVC production plants in Louisiana as a repercussion to Ida hurricane.
Asia
In Q3 2021, values of Ethylene Dichloride (EDC) witnessed an exponential surge in the Asian market backed by the soaring feedstock prices. Firm demand amidst limited availability of Ethylene Dichloride in this quarter further fumed its values across the region. In India, prices of EDC soared during this quarter backed by the surging values of feedstock Ethylene and increasing demand from downstream Vinyl Chloride Monomer (VCM) manufacturers. Moreover, it was reported by the traders that several EDC facilities in the region went offline due to the seasonal maintenance that consequently increased the values of EDC. In addition, extreme rise in the freight costs and limited supply of containers further contributed to the inflation in the pricing trend of EDC during this timeframe. Hence, Ex-Kandla prices spiked from USD 719.66/MT to USD 904.64/MT in July to September timeframe.
Europe
In Europe, a marginal rise in the prices of EDC was witnessed in Q3 backed by the surge in the prices of upstream Ethylene and lower imports from the USA. The demand for EDC remained modest from the downstream Vinyl Chloride Monomer and Poly Vinyl Chloride segment backed by the curtailment in the production rates by several manufacturers due to the energy crisis in this quarter across the region. Besides, an exorbitant hike in the shipping charges and the critical shortage of containers further contributed to the spike in the pricing trend of EDC. FD-Hamburg Ethylene Dichloride prices settled at USD 745/MT in September witnessed a rise of USD 40/MT since July.
For the Quarter Ending June 2021
North America
Repercussions of freezing fallout in the Gulf of USA in mid-February, continued to disturb the market sentiments in this quarter as well. Due to the disrupted production activities in feedstock plants, prices of several downstream products including Ethylene Dichloride increased effectively, which later declined in June with improvement in supply activities. However, following the revival in economic activities, demand for Ethylene Dichloride remained firm throughout the quarter from downstream Poly Vinyl Chloride (PVC) sector, which also supported its prices in USA. Therefore, a consistent rise in prices of Ethylene Dichloride was observed, which settled at USD 660/MT in the second half of May in Texas.
Asia
Overall demand for Ethylene Dichloride remained modest in APAC region, while the prices rose effectively in China due to soaring feedstock prices. In China, prices of Ethylene Dichloride rose effectively during the quarter, supported by fuming feedstock Ethylene prices amid firm demand and inadequate availability. While in the Indian market, demand for Ethylene Dichloride from downstream Vinyl Chloride Monomer (VCM) manufacturers remained muted, due to resurgence of pandemic in the country. Sudden implementation of movement restriction reduced the consumption of PVC in the country, which eventually led to a decline in demand for upstream Ethylene Dichloride. Thus, prices dwindled in the month of May and reached USD 684/MT in India.
Europe
An astonishing rise in prices of Ethylene Dichloride was observed in the European region during this quarter. The demand fundamentals showcased sturdy growth from the downstream VCM and PVC manufacturers, backed by the improvement in economic activities than the previous quarter. Besides, critical shortage of feedstock Ethylene from USA also supported the steep rise in its prices. In the meantime, traders expected some cargoes from other regions like Asia and Middle East to counter this steep rise in these commodities.
For the Quarter Ending March 2021
North America
Stable demand amidst acute shortage, led the EDC prices to follow upward trajectory across the region during this quarter. Winter storm across USA gulf coast disrupted the production activity of several Ethylene Dichloride (EDC) manufacturing units which caused raw material shortage for the production of downstream chemicals like VCM (Vinyl Chloride Monomer) and PVC (Polyvinyl Chloride). Several plants including that of OxyChem with the capacity 680 KTPA EDC and Olin Corp. with EDC capacity 748 KTPA etc. remained idled during this time frame due to this climate calamity. Hence the prices rose effectively high by more than 30% and settled around USD 550/MT by the end of March.
Asia
The Asian market had fair demand for Ethylene Dichloride (EDC) but the supply varied country by country, hence the prices too fluctuated with demand supply fundamentals. In the Chinese market, prices showed significant variations during a week, with FOB offers hovering around USD 780/MT during mid-February. While in the Indian market, prices showed consistent growth, as the demand remained firm from the domestic market but reduction in imports of raw materials from USA and Europe created product shortage. Price of EDC rose by 44.6% since January to settled at USD 735.7/MT during March.
Europe
Europe encountered significant shortage of feedstock Ethylene, which was having high demand from other segments like Polyethylene, during the first quarter. Imports from USA were reduced under rare climatic conditions, which affected the availability of raw materials (like Ethylene) and EDC in the region. These factors lead to a sharp rise in the price of EDC across the region. In addition, imports of EDC from the Middle East were also heard to be halted due to force majeure at a major producing plant worth capacity of 890 KTPA of EDC.
For the Quarter Ending September 2020
Asia
PVC prices in the Asian market rose amid tightened supply due to production outages across the US battered by a series of storms and hurricanes. Buoyant demand forced Asian PVC producers to keep more volumes of EDC for captive use. As a result, EDC supply within Asia remained tightened with offers largely raised above USD 230 per tonne CFR Southeast Asia. Buyers, particularly from Southeast Asia, saw a significant recovery in Q3 as coronavirus-related restrictions were largely eased and downstream PVC demand from construction and manufacturing activity was seen regaining the lost momentum.
Europe
The European Ethylene Dichloride (EDC) demand rose as the consumption by the downstream PVC manufacturers rose on the back of rebounding construction demand which had tumbled significantly in Q2 because of the dented economics. Lack of export volumes as inflows from the US remained largely nil triggered a sharp surge in the regional pricing. Traders maintained the margins low as the demand is yet to reach the pre-pandemic levels amid fears of second wave triggering fresh lockdowns in several states. FOB NWE EDC prices were assessed around USD 350 per MT levels, extending significant gains observed on Q-o-Q basis.
North America
The American EDC market remained highly dynamic throughout Q3 2020 with regional producers observing a sharp pick-up in the buying behavior in response to the pent-up PVC demand, especially from the Asian markets. Power outages due to Hurricane Laura delayed start-ups of several Chlor-Alkali units in Lake Charles causing tightening in both domestic and export supply. Olin, the world's largest Chlor-Alkali producer, was heard temporarily idling Chlor-Alkali plants to manage costs and inventories. Formosa Plastics USA declared force majeure on its PVC manufacturing unit in August after an upstream chlor-alkali unit remained shut for longer than planned, causing potential shortage of EDC stocks. EDC Prices took off from the ground levels after witnessing a historic plunge (about 70%) during Q2 2020.
