Offers
limited feedstock uncertainty Ethylene production margin below typical
breakeven levels



Spot
discussions in the Asian Ethylene Market on Feb. 9 were very limited. Most
participants were in wait-and-see mode due to volatility in the upstream crude
oil, naphtha, and market. The feedstock uncertainty slowed down firm offers, although
there was strong buying interest in late-February and early March arrivals. Some buyers indicated that they could face possible
reductions in downstream operating rate, such as for styrene monomer (STM) or
ethylene glycol(EG), because of negative margins due to weak demand and a large
rise in ethylene values following the Lunar New Year holidays. A Taiwanese ethylene buyer stated that they cannot afford
ethylene at current prices taking into account their production margins for EG. We will reduce operating rates even further starting in
February's...