Producers across Northeast Asia (NEA) and Southeast Asia (SEA) have reduced cracker operating rates due to feedstock constraints. The near-closure of the Strait of Hormuz is expected to delay naphtha supplies further, tightening availability in the region.
Spot prices in both regions have now crossed the $1400/ton CFR level, with no signs of easing supply. Prices on a CFR China basis have reached their highest levels since October 2014.
The gap between Southeast Asia and China prices narrowed to $30/ton, reflecting stronger gains in the SEA market.
Latest Price Levels
• CFR China: $1450/ton (up $50)
Bids: $1350–1400
Offers: $1450–1500
• CFR Southeast Asia: $1420/ton (up $70)
Bids: $1300–1380
Offers: $1450–1500
Strong Demand and Limited Supply Support Market
Tight supply conditions continue to support ethylene prices across China, South Korea, Taiwan, and Japan.
Market participants expect shortages to continue, with traders actively covering April commitments. FOB China offers are around $1400/ton, translating to $1450–1500/ton CFR for key importing markets.
Recent deals from major Chinese producers were reported in the $1380–1400/ton FOB range for April shipments.
China’s domestic market has also strengthened:
• Sinopec raised prices by CNY 500/ton to CNY 10,000/ton
• East China spot prices increased to CNY 10,000–10,200/ton
Supply Disruptions and Production Cuts Intensify
Feedstock shortages have triggered multiple disruptions across the region:
• YNCC (South Korea) declared force majeure
• Formosa Petrochemical (Taiwan) announced supply disruptions
• Wanhua Chemical (China) declared force majeure
• Shell-CNOOC Huizhou cracker shut due to feedstock issues
Operating rates in South Korea have been reduced significantly:
• YNCC: around 60%
• LG Chemical: around 70%
• Hyundai Chemical and GS Caltex: around 65%
• KPIC: around 80%
Southeast Asia Market Catches Up with Northeast Asia
Southeast Asian prices rose sharply, supported by tight supply and strength in Northeast Asia. Higher crude and naphtha prices also contributed to the uptrend.
Prices reached $1420/ton CFR SEA, effectively closing the arbitrage opportunity with Northeast Asia for April cargoes.
• Bids: $1300–1380/ton
• Offers: $1450–1500/ton
Operating Rates Reduced Across Key Plants
• Aster Chemicals (Singapore): operating at 50–60%
• ExxonMobil (Singapore): operating at 60–70%
• PCS (Singapore): operating at 50–60%
• Chandra Asri (Indonesia): operating at 50–60%
• Lotte Chemical (Indonesia): operating around 60%
• PTTGC (Thailand): operating at 60–70%
• SCG (Thailand): operating at 60–70%
• PRefChem (Malaysia): shutdown or reduced rates
• Long Son Petrochemical (Vietnam): operating at 60–65%
Market Outlook
With ongoing feedstock disruptions, lower operating rates, and multiple supply issues, the Asian ethylene market is expected to remain tight in the near term.
Prices are likely to stay firm, with further upside possible if supply constraints continue.
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