US OLEFINS
Spot olefins pricing has been on the rise as planned and unplanned steam cracker outages tighten supply. Spot ethylene closed Friday 1.375 cents/lb higher week on week, while spot propylene rose 1.25 cents/lb in the same period.
Shell's 886,000 mt/year OL-5 steam cracker in Norco, Louisiana, began a planned turnaround December 4, sources said, adding that it should last 2-3 weeks.
Dow Chemical also started maintenance December 4 on the new 1.5 million mt/year Light Hydrocarbons Unit No. 9 at in Freeport, Texas, the company said in a regulatory filing.
The emissions event associated with maintenance on an exchanger at the steam cracker is scheduled to run through December 24, according to the filing with the Texas Commission on Environmental Quality. But market sources said the steam cracker is expected to begin startup operations in five to seven days. This comes a week after Dow shut its 1.03 million mt/year Plaquemine LHC 3 cracker in Louisiana, a source familiar with operations said.
US POLYETHYLENE
US export polyethylene prices continued to edge lower last week, with market sources still describing availability as limited for some grades.
Trader sources have continued to push for lower pricing, which they contend is needed for deals to key regions beyond Latin America.
Exporters also were keeping an eye on the calendar for potential China-bound cargoes, with sources noting that deals would likely need to be concluded in the next week to make sure resin arrived before the Lunar New Year in mid-February.
Domestic market players are pushing for a decrease in December, sources said, noting that buyers will likely increase their push to remove some of the 10-cent increases implemented during the second half of 2017 due to post-Hurricane Harvey production issues and associated tightness.
US POLYVINYL CHLORIDE
Export polyvinyl chloride market participants will be watching for more signs of a rebound this week as Shintech negotiates January pricing, sources said.
While two producers were heard settling December pricing between $765-$770/mt FAS Houston, prices were assessed last week at $775-$785/mt FAS Houston -- up $20/mt week on week -- on stronger spot demand and limited availability.
At least two producers had no incremental volumes to sell, sources said, while buyers pointed to expectations for prices to rise in January, prompting more interest in building volumes to sell later.
Westlake Chemical also is expected to restart its 861,825 mt/year PVC plant in Plaquemine, Louisiana, by next week, according to a source familiar with company operations.
In related markets, caustic soda prices could see declines this week, a 10,000 dmt cargo seen done in the second half of November at $595/mt FOB USG and market talk of a 10,000-15,000dmt to East Mediterranean at $585-$605/mt FOB USG, while smaller cargoes have fetched higher prices, such as $3,400dmt at $665/mt FOB USG.
US METHANOL
In the coming week, the US Gulf spot market will be looking to European and Asian markets for directions cues, sources said. US spot prices have rallied to 9-month highs as prices align globally, climbing 5.5 cents since last Monday amid global supply tightness.
Elsewhere, methanol pricing climbed Eur14/mt week on week and the CFR China marker made substantial gains, climbing $17 since December 4.
Market sources say there is room for spot prices to continue to advance before the year-end.
US AROMATICS
US spot toluene prices remained strong as disproportionation margins continued to soften. Prompt toluene prices closed the week at 254 cents/gal as TDP margins fell as on weaker xylenes, shedding roughly $87 to finish the week estimated at $36.62, according to S&P Global Platts data.
That same data showed a near $28 decline in MSTDP margins, which finished the week at $79.75.
HDA margins remained healthy on continued strength in benzene, estimated at near $83//mt.
Toluene conversion margins continued to be supported by healthy benzene as December benzene gained 8 cents on the week to close at 332 cents/gal DDP USG.
Benzene supply in the US was expected to increase in January on stronger Asian exports and this could crimp toluene conversion margins and subsequently reduce toluene demand.
In mixed xylenes, prices appeared to have bottomed out, assessed Friday at 220 cents/gal FOB USG following at least two trades at that level during the week.
Sources continued to point to octane as the demand driver as spreads to reformate showed unfavorable extraction economics.
The MX-reformate spread closed the week at just 3.7 cents. Mixed xylene's blend value was down roughly 5 cents on the week, finishing Friday at near 217.50 cents/gal, according to Platts S&P Global data.
Demand from the downstream paraxylene sector was soft as there remained uncertainty regarding PTA and PET production in the US, due to M&G Chemicals financial woes. This lead those in the US PX markets to push material to Asia in an effort to balance out the market and with at least 50,000 mt heard loaded in November and early December.
