The northwest European FOB spot prices of ethylene dichloride and vinyl chloride monomer rose by $10/mt and $19/mt on the week to $375/mt and $723/mt, respectively, supported by a rise in the cost of feedstock ethylene and derivative polyvinyl chloride. Supply is very scarce, because of steam cracker outages and this is having a bullish effect on prices. “We have some limited ethylene supply...therefore we have to buy some EDC, but we are in detailed negotiations from possible suppliers, so of course an increase will be in line with the ethylene increase,” an EDC production source said. Increases to last week’s price were heard pegged at $15-20/mt. The June ethylene contract price settled at Eur1,105/ mt ($1,246/mt), up Eur60/mt month-on-month. This was a high not seen since November 2014. Ethylene accounts for 29% of EDC feedstock costs and 49% of VCM feedstock costs. The new ethylene settlement could mean an increase of a further $5/mt to the EDC price, if the full ethylene rise is passed through. Production problems at steam crackers have recently affected approximately 15% of ethylene capacity in the region.
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