Ethylene prices in Asia knee-jerk on tight supply

Ethylene prices in Asia recorded a significant gain last Friday as tight supply stemming from a series of plant shutdown has boosted the market amidst healthy downstream demand. Indeed, CFR Southeast Asia cargoes leaped $75/t in one single day to reach $1090/t, the best value ethylene market recorded since late December 2015.

A number of regional crackers will be taken off-stream for maintenance work, which is heavily scheduled during February to April 2016 as shown in the following table. Ethylene supply in Southeast Asia is also affected by Shell Singapore’s unexpected shutdown its Pulau Bukom cracker early December 2015 due to a major technical fault. The plant might remain offline until September 2016. Besides, Indonesia’s Chandra Asri is operating its newly expanded naphtha cracker at 50-60% capacity since early Feb after encountered some mechanical glitches. The company is working to ramp up the production rate to 100% by end of this month, according to sources.

In the downstream market, demand in the PE, PVC and PET market pick up considerably after the Chinese New Year holidays as buyers are replenishing stock in preparation for the peak season. Many players expect the firming trend might last till May 2016 when crackers fully resume production after the scheduled turnaround.

Kindly visit CommoPlast Plant Status for the latest plant status in Southeast Asia and China.