Ethylene spot prices have softened marginally for the first time since December 6 as feedstock naphtha prices fell, sources said.
Ethylene was assessed at Eur1,000/mt ($1362) FD NWE Wednesday, down Eur7.50/mt on the day. Naphtha was assessed at $912.25/mt CIF NWE, compared with $948.50/mt on December 31.
A trade was heard at Eur1,000/mt FD NWE for ethylene Wednesday. The same buyer reported a trade at Eur980/mt FD NWE Thursday morning.
The decline in ethylene prices was cushioned by tight NWE supplies caused by production issues. "I believe both Gonfreville and Feyzin crackers are still struggling a bit," one trader said. The French crackers were shut down during a strike that began in mid-December, affecting all five of Total's French refineries, taking out 1 million b/d of refining capacity. The Feyzin cracker restarted in early January, but was not operating at full capacity, sources said.
It was unclear whether the Gonfreville cracker had restarted.
Total declined to comment.
The European naphtha market has weakened on the back of a weaker Asian market as traders eyed high arbitrage arrivals over February and March. Limited regional demand in Northwest Europe has also pressured the market as pockets of gasoline blending demand and demand from petrochemical end users was not enough to support values.
The front-month crack swap was heard trading at minus $5.25/barrel Thursday morning, down from minus $4.65/b assessed Wednesday.
Meanwhile, propylene held steady at Eur1130/mt FD NWE Wednesday, with tight supplies offsetting the fall in naphtha. The propylene spot price has been on uptrend since December 13, when it was assessed at Eur1067.50/mt FD NWE.
Sources reported improved cracker operating rates in January compared with December, at 80-85% as naphtha prices eroded. December rates were pegged at 75%.
Hydrocarbons such as naphtha are feedstocks for steam crackers producing olefins such as ethylene and propylene.
