Asia Ethylene Extends 11-Week Decline as Weak Oil and Feedstock Markets Pressure Prices

Asian spot ethylene markets remained under pressure this week, marking the eleventh consecutive week of declines across both Northeast and Southeast Asia. Although the pace of losses has slowed compared to the steep corrections seen earlier in the quarter, weak crude oil prices, falling naphtha values and sluggish downstream demand continue to weigh heavily on sentiment.

Market participants are closely watching feedstock costs for signs of stabilization. However, declining crude oil values have kept pressure on the entire petrochemical chain, limiting any meaningful recovery in ethylene prices.

Ethylene Market Snapshot

Northeast Asia (CFR China)

Latest Price: $860/ton
Weekly Change: ▼ $15/ton
Bid Levels: $820-830/ton
Offer Levels: $900-950/ton

Southeast Asia (CFR SEA)

Latest Price: $850/ton
Weekly Change: ▼ $40/ton
Bid Levels: $800-820/ton
Offer Levels: $900-950/ton

A notable shift emerged this week as Southeast Asian prices slipped below Northeast Asian levels, reversing the traditional premium usually seen in the region.

Southeast Asia Faces Heavy Selling Pressure

The sharpest weakness was seen in Southeast Asia, where aggressive selling activity continued to drag prices lower. Recent transactions for July cargoes established fresh benchmarks around $850/ton CFR Thailand.

Since April, regional spot prices have fallen by nearly 44%, reflecting a significant correction from conflict-driven highs earlier this year. Buyers remain cautious and continue to delay purchases in anticipation of additional declines.

Supply is also expected to increase in the coming weeks as several major crackers in Malaysia resume operations, adding fresh material to an already well-supplied market.

Northeast Asia Remains Under Pressure

Despite tighter supply conditions in parts of China due to maintenance shutdowns and reduced operating rates, Northeast Asian ethylene prices continued to soften.

Weak demand from key downstream sectors such as PE, PVC, MEG, styrene and ethylene oxide has limited purchasing activity. Falling PE margins have further reduced appetite for ethylene, adding to bearish market sentiment.

Several Chinese crackers remain under maintenance or operating at reduced rates, while South Korean supply remains somewhat constrained due to extended turnarounds. However, expectations of higher regional production in the coming weeks continue to pressure prices.

Key Plant Updates

Current Shutdowns & Maintenance

ENEOS Kawasaki (Japan): Restart expected in late June
Mitsubishi Chemical Kashima (Japan): Restart expected mid-July
Mitsui Chemicals Chiba (Japan): Under two-month maintenance
YNCC Yeosu (South Korea): Extended shutdown; permanent closure planned in August
LG Chem Yeosu (South Korea): Offline due to feedstock constraints

Upcoming Maintenance

ENEOS Mizushima RFCC (Japan): Scheduled shutdown from mid-September
Idemitsu Kosan Tokuyama RFCC (Japan): Planned maintenance from September to November
Outlook

Market sentiment remains largely bearish as falling crude oil prices, weak downstream demand and upcoming cracker restarts continue to pressure ethylene values. While shrinking cracker margins may eventually limit further declines, most market participants expect prices to remain under pressure until supply-demand balances improve across the region.

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