Spot prices of ethylene in the US declined to the lowest level in nine years against the backdrop of the emergence of new crackers and weakened demand due to planned stops of processing plants, ICIS reports citing market participants.

On Tuesday, March 20, the price of ethylene in the US was at the level of 16.25 cents per pound (USD358 per tonne), which is the lowest price since December 12, 2008, when the country’s economy was experiencing an economic crisis.

Spot prices of ethylene in the US fell from the middle of January, when all the enterprises closed due to hurricane Harvey in August last year were operating at full capacity. In addition, Dow Chemical began to increase the load on a cracking unit with a capacity of 1.5 million tons of ethylene per year. In addition, the launch of the new cracking plant Chevron Phillips Chemical capacity of 1.5 million tons in early March also exacerbated the situation.

As of March 16, spot ethylene prices in the US were 17.5-19.0 cents per pound (USD385-418 per tonne), compared to 28.5-29.0 cents per pound (USD627-638 per tonne) per week, which ended on 19 January.

Earlier it was reported that the export of ethylene from the US increased by 3% last year compared to the level of the previous year. The December export of ethylene fell by 83% against the same month of 2016, and compared to November 2017 this indicator showed a decrease of 90%. At the same time, imports of ethylene to the United States during the reporting period were not carried out.

Ethylene is the main raw material component for the production of polyethylene (PE).

According to the DataScope of the company MRC, the total volume of external PE supplies to the Russian market grew by 12% as compared to the level of 2016 and amounted to 603.8 thousand tons. Supplies of polyethylene of low pressure (HDPE) and ethylene-vinyl acetate (EVA) have significantly increased.

The main producers of ethylene in the US are Chevron Phillips Chemical, DowDuPont, ExxonMobil, INEOS Olefins & Polymers, LyondellBasell and Shell Chemical.