Market and product
Asian PE producers struggling with higher ethylene costs
Spot ethylene prices have risen by US$125/ton on a CFR NEA basis when compared with the first week of January, while offers for HDPE film have posted smaller increases of US$10-25/ton on a CFR China basis and LLDPE film prices have increased by US$10/ton on a CFR China basis on the low end of the range. Despite the increasingly thin spread between ethylene feedstock costs and PE prices, ethylene sellers reported that they are standing firm on their higher offer levels considering the prospect of higher crude oil prices as political unrest spreads through the oil-producing countries of the Middle East and Asia prepares to enter a heavy cracker maintenance season. Despite steadily increasing ethylene feedstock costs, major overseas producers are mostly announcing March PE prices with rollovers to decreases when compared with their most recent February offer levels. Producers who have raised March prices in hopes of covering increasing production costs report to have met with resistance from the buyers’ side.
This week, a South Korean producer announced March LLDPE film prices with decreases of US$50/ton when compared with their most recent sell ideas while a Taiwanese producer reduced their March sell ideas for LLDPE film by US$20/ton from their most recent price targets. Late last week, a global producer announced rollovers on their offers for both HDPE film and LLDPE film while a Middle Eastern producer who raised their prices by US$60-70/ton for LLDPE film and by US$50-60/ton for HDPE film complained that buyers have been unwilling to accept their new prices.
Source:http://www.plastemart.com
