Ethylene producers in Northwest Europe have fixed two cargoes to Asia for March loading driven by length in domestic market, the turnaround season in Asia and port congestion in the Middle East, sources said this week.
Europe, a net importer of ethylene, has already exported two vessels to Asia earlier this year -- Clipper Hermes and Clipper Helen.
This week, sources said that "two, possibly three large parcels [ex-Europe for Asia] were fixed recently for March loading."
NWE was also exporting to the Mediterranean. FOB prices were heard at $1,200-1,250/mt FOB NWE. A deal earlier in the week was reported at Eur970/mt ($1,338/mt) CIF Med, 4,500 mt for March loading. "The Mediterranean is shorter than the North but this is linked to delays and short-term issues, and it should balance out," the buyer said.
A European-origin cargo of around 9,000 mt for end-April delivery was heard traded at $1,480/mt CFR China Wednesday, Asian sources said.
Asian buyers were worried about affordability, with all derivatives margins in the red except for vinyl chloride monomer. CFR Northeast Asia prices were up $18 week on week to $1,500/mt Friday. The main reason for the rise in the ethylene market is the upcoming steam cracker turnaround season in Asia over March-May, sources said.
PORT CONGESTION AT RUWAIS
Congestion at the UAE port of Ruwais was adding to the tightness in the Mediterranean and Asia, sources said.
"Our vessel should have sailed a week ago, but it is doing so tonight," an European buyer said. "If you are loading 12,000 mt at 100 mt/hour rather than the usual speed of 500-600 mt/hour there will be delays," he added.
He added that it might be an issue at the port. Another source said it was a shortage of feedstock at Ruwais.
Borouge -- in the UAE -- began start-up procedures at the Phase 3 complex at Ruwais in January. Borouge-3 consists of a 1.5 million mt/year ethane cracker, a 1.08 million mt/year polyethylene plant, a 350,000 mt/year low density polyethylene plant and a 960,000 mt/year polypropylene plant.
Construction of the complex was completed in December. Borouge is joint venture between the Abu Dhabi National Oil Co. (ADNOC) and Borealis. Borealis was not immediately available for comment.
