Exploding Ethylene
Market research firm Cischem said on Jan. 5 that the average ethylene price reached US$1,090 per ton last month, up 14 percent from a year ago.
During the same period, the Dubai crude oil price almost halved from US$60 to US$38 per barrel, and the price of naphtha, which is used in ethylene production, fell approximately 19 percent from US$543 to US$440 per ton. The profitability of ethylene product sellers improved in December last year as the price of the raw material fell and the product price rose.
In Korea, Hanwha has the largest ethylene production capacity, 2.91 million tons a year to be specific. It is followed by Lotte Chemical (2.82 million tons), LG Chem (2.09 million tons) and SK Chemicals (1.66 million tons).
According to experts, Korean ethylene suppliers are expected to be able to maintain the upper hand in the market for a while based on their competitive pricing and current low international oil prices. “Chinese companies have worked on coal-based ethylene production since 2010, but it is said that only eight out of the 28 projects to that end are ready for implementation as of now,” one of them explained.