NSWA MarketCast

December 16, 2009 to January 15, 2010, Vol. 2, Issue 01
Polyethylene prices moved higher in the first half of January after holding steady in December. The upward move came as ethylene prices moved higher while further upstream ethane eased.

PE producers were seeking to implement contract price increases of 4-5 cpp in December. Several participants said that agreements were ultimately reached to keep prices flat in December. In January, producers said they were seeking to implement increases totaling 8 cpp, followed by 5 cpp increases in February. One producer has modified that proposal, saying it would seek a 4 cpp increase in January, followed by an additional 8 cpp increase in February. While the status of these January initiatives remains under discussions, several participants said they are seeing 4 cpp reflected in their pricing so far this month.

Spot prices are up about 4 cpp from December levels. Resale prices for generic prime railcars of HDPE blow mold into the domestic market are now in the high 50s cpp range, up from the low-to-mid 50s cpp in December. LLDPE film butene grade is in the high 50s cpp-low 60s cpp range. Export demand has been strong in January. HDPE blow mold is trading in the low 50s cpp on an FOB Houston basis, up from the high 40s cpp in December. LLDPE film is at a premium of about 1.5-2 cpp over blow mold.

Spot ethylene prices rose about 20% from mid-December to mid-January. Spot ethylene was trading around 36 cpp in mid-December, and rose to 43-45 cpp in January. Rising prices came amid several steam cracker outages, strong demand for polyethylene, rising ethane prices and an overall tight ethylene supply situation.

Further upstream, ethane was up sharply in the second half of December, rising from 65 cpg to 80 cpg, but subsequently eased to about 73 cpg by mid January.

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The PetroChem Wire is a daily newsletter serving the petrochemical industry. It counts every major chemical and refining company among its subscribers, as well as many major manufacturing concerns, global conglomerates, industry consultants, equity analysts and government agencies.

Contact:
Mark Quiner, Senior Editor
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Copyright 2010

This entry was posted on Thursday, January 21st, 2010 and is categorized under Podcast Series, Stretchwrap Markets Review.