US spot ethylene was hovering at three-month low levels Friday, trading midday as low as 51.50 cents/lb MtB Williams pipe for September delivery on the back of what market sources said was improved availability.
Recent unplanned production issues in downstream polyethylene as well as logistical constraints for getting ethylene into Louisiana from Texas were providing downward pressure for Mont Belvieu-basis ethylene, sources said.
Ethylene for September delivery was heard brokered at 51.625 cents/lb, 51.75 cents/lb and lower at 51.50 cents/lb MtB Wms by midday and last heard talked in a range of 51-51.75 cents/lb MtB Wms.
October ethylene was heard talked in a range of 51.50-52.25 cents/lb MtB Wms, with no deals heard. Ethylene for September or October delivery into Choctaw in Louisiana was heard bid at 54.50 cents/lb against no offers.
At these levels, ethylene was at its lowest levels since being assessed at 51.25-51.75 cents/lb FD USG on June 11 and flirting with 9 1/2-month lows, according to Platts data.
Polyethylene producers including ExxonMobil Chemical in Baton Rouge, Louisiana, Equistar in Matagorda, Texas, and Formosa Plastics Corp USA in Point Comfort, Texas, have experienced production issues in recent weeks, which have affected ethylene demand. On PVC, at least two major producers plan turnarounds in the US Gulf Coast region over the next two months and maintenance efforts are slated to take place on the styrene side as well, sources said.
Olefins producers in the US Gulf Coast have not encountered major production issues over the past couple of weeks, sources pointed out, and no inclement weather is expected to threaten production over the next week, although hurricane season remains in effect.
Spot ethylene was last assessed Thursday at 52.75-53.25 cents/lb FD USG.
After Platts' 3:15 p.m. EDT market-on-close, September ethylene was heard traded lower at 52.50 cents/lb MtB Wms for September and at 51.75 cents/lb MtB Wms for October.
