Ethylene prices in Asia plummeted to US$1095/MT in the week of October 22, 2007. Anticipation of escalating supplies from the Middle East and Far East region has been mainly responsible for this sharp drop. Current offers from sellers seem to be lowering in anticipation of a further price drop in November, when prices are expected to take a sharp turn southwards on increased supplies. On the supply side, Formosa plans to restart its 900,000 tpa no.2 cracker by second week of November, followed by the start up of Taiwan's CPC's 230,000 tpa no.3 cracker. South Korean producers are also expected to restart crackers shortly after completion of annual turnarounds. All these start ups will cause a supply glut.
Europe has had tighter ethylene supplies on account of planned turnaround outages at several cracking plants in November this year, leading to an influx of material from the Middle East. Iran, Qatar and Saudi Arabia are exporting almost half their output to Europe on account of better price realization.
Wednesday, October 24, 2007
FEEDSTOCK - ETHYLENE
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