US ethylene spot prices rise 5% on growing flood fears

Plastics May 14, 2011 No Comments

EthyleneUS ethylene spot prices rose by 5% in the last three days, market sources said on Friday, citing growing fears that flooding will affect operations at crackers near the Mississippi river.

Ethylene for May traded at 70.50 cents/lb ($1,554/tonne, €1,088/tonne) on Friday, up from deals done at 67 cents/lb early in the week.

Market sources said the surge in spot prices stemmed from concerns that expected flooding next week could disrupt production at a number of crackers near the Mississippi river in Louisiana.

The crackers that could be affected include a 610,000 tonne/year Dow Chemical unit in St Charles; a 612,000 tonne/year Williams cracker in Geismar; and two Shell crackers in Norco, which have a combined capacity of 1.4m tonnes/year.

“The Mississippi river peaks next week at levels never seen by these crackers,” a market source said, adding that flooding could force the crackers to cut rates, if not shut down altogether.

The four crackers account for around 10% of total US ethylene capacity.

via US ethylene spot prices rise 5% on growing flood fears.

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Rod Sherkin

Rod is a former senior executive, responsible for Purchasing, for both Pillsbury and Ball Packaging back in the 80’s and 90’s. Since then, he has continued to work in the Purchasing field as both a consultant and founder of the website Propurchaser.com.

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