The contract price of ethylene in Europe for March deliveries was agreed at EUR1,015 per ton, which is EUR30 per ton higher than February, some participants in contract market negotiations told ICIS on Friday.

The contract price was approved under the terms of FD NWE (with delivery to North-West Europe).

This level of the contract price was directly confirmed by the three manufacturers and two consumers, which is a sufficient configuration for the approval of the monthly contract price for the material.

The contract price is considered fully agreed upon after confirmation from at least two manufacturers (suppliers) and from two consumers (buyers).

Quotations of raw materials – naphtha – rose last month, which was the main reason for the increase in the contract price of ethylene. According to ICIS, growth was EUR30 per tonne compared with the January level.

Market demand and supply were better balanced in February amid unplanned downtime of the cracking plant in Europe and improving demand.

The level of material reserves in the region is high, as market players are well prepared for the start of scheduled stops for the prevention of European production in mid-April.

Earlier it was noted that the contract price of ethylene in Europe for February deliveries was finally agreed at the level of EUR985 per tonne, which corresponds to the level of January.

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

According to the ICIS-MRC Price Review, the past week regarding the demand in the Russian PE market was very calm. For the most part, processors closed all of their deals a week earlier and stood in anticipation of negotiating prices for the March shipments. Excessive supply and low market demand persist, and these factors put serious pressure on prices. In the HDPE segment, cheap imports from Central Asia also affect prices. Last week price decline continued.