HOUSTON (ICIS news)--US ethylene contracts for May settled on Wednesday at a drop of 7.75 cents/lb ($171/tonne, ?40/tonne), falling by 15% from April due to continued pressure from the spot market.
The settlement put May ethylene at 44.75 cents/lb, according to ICIS pricing.
The reduction stemmed from a slump in spot prices, a market participant said, adding that production costs remained mostly steady last month.
Spot ethylene ended May trading at 36.00-38.25 cents/lb, down from deals done in a range of 42.00-47.25 cents/lb four weeks earlier.
The drop in spot prices was caused by looser supply, as most US crackers had resumed operations following a series of shutdowns earlier this year.
The settlement for May was the second consecutive reduction for US ethylene. The monomer had already dropped by 3.00 cents/lb in April, also caused by pressure from the spot market.
The downtrend on the contract side may linger into June amid sustained weakness in spot values.
Ethylene for June traded on Tuesday at 35.50 cents/lb, while bids on Wednesday were heard at 30.00 cents/lb.
Chevron Phillips Chemical, ExxonMobil, INEOS, LyondellBasell and Shell Chemicals were among the major producers of ethylene in the US.
Dow Chemical, Georgia Gulf, Occidental Chemical (OxyChem) and Total were among the buyers.
($1 = ?.82)
The settlement put May ethylene at 44.75 cents/lb, according to ICIS pricing.
The reduction stemmed from a slump in spot prices, a market participant said, adding that production costs remained mostly steady last month.
Spot ethylene ended May trading at 36.00-38.25 cents/lb, down from deals done in a range of 42.00-47.25 cents/lb four weeks earlier.
The drop in spot prices was caused by looser supply, as most US crackers had resumed operations following a series of shutdowns earlier this year.
The settlement for May was the second consecutive reduction for US ethylene. The monomer had already dropped by 3.00 cents/lb in April, also caused by pressure from the spot market.
The downtrend on the contract side may linger into June amid sustained weakness in spot values.
Ethylene for June traded on Tuesday at 35.50 cents/lb, while bids on Wednesday were heard at 30.00 cents/lb.
Chevron Phillips Chemical, ExxonMobil, INEOS, LyondellBasell and Shell Chemicals were among the major producers of ethylene in the US.
Dow Chemical, Georgia Gulf, Occidental Chemical (OxyChem) and Total were among the buyers.
($1 = ?.82)
