. Additional pressure was applied from bearish trends in downstream polyethylene (PE) and polyvinyl chloride (PVC). FOB Korea ethylene prices on Friday, Feb. 27, fell to $600/tonne, a drop of $40/tonne from the week before. CFR Northeast Asian prices of ethylene, meanwhile, were assessed at $640/tonne. Reports of mechanical problems at Formosa Petrochemical’s 1.2 million tonnes/yr No. 3 cracker that will compel it to shutdown for two weeks failed to lift prices. Ethylene bids surfaced at $540 to $550/tonne FOB Korea. In Southeast Asia, the ideal price target margin grew, with sellers placing offers above $650/tonne CFR, while buyers came in below $600/tonne with their bids.
Spot rates of linear low-density polyethylene (LLDPE) finished steady in Asia last week, in spite of drops in ethylene and the perception of softening demand. CFR Far East Asia LLDPE prices were assessed at $990/tonne, with CFR South Asia LLDPE prices at $1030/tonne. A trader contacted by Polymerupdate said a spike in crude oil prices, which lifted naphtha, impacted PE prices, as did reports that Middle East producer Yansab has delayed the start up of its new PE complex located at Yanbu until the second quarter of 2009. The plant will have an LLDPE output capacity of 400,000 tonnes/yr. In other plant news, Petro Rabigh is due to start up its new 350,000 tonnes/yr LLDPE plant located at Al Jubail in the middle of March, following the start up of its new 1.3 million tonnes/yr steam cracker.
Propylene prices fell with diminished buying activity in polypropylene (PP), with FOB Korea propylene prices off $30/tonne from a week earlier to $640/tonne. PP prices are expected to drop as new capacity comes online this month in Saudi Arabia at Petro Rabigh and in India with Reliance Industries’ new PP unit. In addition, a trader contacted by Polymerupdate said heavy fog has slowed down operations at many key Chinese ports including Shanghai, Jiangyin, Nanjing and Nantong, leading to a build up in propylene stock in Japan and South Korea. In Southeast Asia, offers for propylene are at $750 to $760/tonne CFR with bids below $700/tonne CFR.
Styrene Monomer (SM) prices raced higher last week in Asia, with FOB Korea prices on Friday, Feb. 27, hitting $755 to $760/tonne. CFR China SM prices were assessed at $775/tonne, while CFR India SM prices were reported at $790/tonne. Strength in upstream crude and naphtha, as well as a spurt in Friday’s benzene rates, helped support the spike in SM rates. In China, SM climbed RMB 400/tonne to RMB 6100/tonne ex-tank basis in East China. In plant news, Shuangliang Lishide’s 200,000 tonnes/yr No. 1 SM plant was reported down due to a shortage of natural gas. Elsewhere, Chevron Phillips’ 750,000 tonnes/yr plant in Al-Jubail was reported to be experiencing mechanical problems at its SM plant. —[email protected]