Asian Ethylene: Southeast Asian Prices Fall Further as Northeast Asia Stabilizes

Asian ethylene markets moved in different directions this week, with Southeast Asian prices declining for a third consecutive week while Northeast Asian values held steady amid limited trading during China’s National Day holiday. Despite reduced cracker operating rates and planned maintenance shutdowns, weak downstream demand and buyers’ reluctance to purchase spot cargoes continued to weigh on market sentiment.

Traders with uncovered requirements for late October and November largely stayed on the sidelines, hoping to secure further discounts as the market entered its first significant correction after nearly two months of increases. However, low cracker operating rates and limited prompt availability could restrict further price declines, particularly if buyers return to cover their outstanding needs.

CFR China ethylene prices remained unchanged at $1,150/ton, keeping ethylene at a $120/ton discount to propylene in Northeast Asia. This difference highlights the contrasting supply-demand conditions for the two olefins, with propylene receiving stronger support from tighter availability.

A Western trader attributed ethylene’s weakness to relatively comfortable supply compared with propylene and, more importantly, limited downstream demand. Lower operating rates across major derivative sectors, including PE, styrene monomer (SM), monoethylene glycol (MEG) and ethylene oxide (EO), have reduced ethylene consumption. Weak derivative margins have also made it more difficult for producers to sustain higher feedstock prices.

Ethylene Price Overview

CFR China
Latest Price: $1,150/ton | Weekly Change: Unchanged | Bid Range: $1,130–1,140/ton | Offer Range: $1,250–1,300/ton

CFR Southeast Asia
Latest Price: $1,110/ton | Weekly Change: −$10/ton | Bid Range: $1,090–1,100/ton | Offer Range: $1,200–1,250/ton

Northeast Asia Stabilizes After Two Weeks of Declines

Ethylene prices in Northeast Asia remained broadly unchanged as China’s National Day holiday limited spot market activity. Although Chinese markets reopened on October 8, many participants had yet to resume normal trading, extending the holiday-related slowdown.

Ahead of the break, some traders reduced their long positions, contributing to a cumulative price decline of $50/ton over the previous two weeks. Despite this correction, CFR China ethylene prices remained approximately 18% above early-August levels.

Indicative bids were reported at $1,120–1,130/ton CFR China, reflecting limited buying interest. One transaction was recorded at $1,150/ton CFR East China, involving a Chinese trader purchasing material to meet the requirements of a domestic contract buyer. Meanwhile, fixed-price offers were heard at $1,200–1,250/ton CFR China/Northeast Asia.

The wide gap between buying and selling indications continued to restrict spot transactions. For floating-price cargoes arriving in October, sellers sought premiums of $40–50/ton over CFR Northeast Asian assessments, while buyers indicated premiums in the single digits. Bids for October-loading FOB China cargoes were reported at premiums of $5–10/ton over CFR Northeast Asian assessments.

End-user participation has remained limited for much of the year. Considerable price volatility has encouraged derivative producers to rely mainly on contractual volumes rather than purchase additional spot cargoes.

In China’s domestic market, Sinopec maintained its ethylene list price at CNY9,400/ton. Spot prices in East China and Shandong increased by CNY100–200/ton to CNY9,300–9,500/ton.

Regional Cracker Constraints Could Limit Further Declines

Despite subdued spot demand, Northeast Asian ethylene supply is expected to remain tight throughout October and the fourth quarter. Reduced cracker operating rates and scheduled maintenance shutdowns in Japan, South Korea, Taiwan and China are expected to restrict regional availability.

In Japan, several crackers continue to operate at reduced rates of around 70–80%, while maintenance activity and closures affecting propylene-producing units are also influencing the regional supply picture.

Northeast Asian Plant and Maintenance Updates

ENEOS — Kawasaki, Japan (Ethylene Cracker)
Capacity: 540,000 tons/year | Status: Restarted in June following a March maintenance shutdown; currently operating at 70–80%.

ENEOS — Kawasaki, Japan (Ethylene Cracker)
Capacity: 443,000 tons/year | Status: The company plans to close one of its two Kawasaki naphtha crackers by March 31, 2028.

ENEOS — Kashima, Japan (RFCC)
Propylene Capacity: 90,000 tons/year | Status: Shut down in mid-May, with no confirmed restart date.

ENEOS — Mizushima, Japan (RFCC)
Propylene Capacity: 93,000 tons/year | Status: Shut down in mid-September; restart timing remains unconfirmed.

Mitsubishi Chemical — Kashima, Japan
Ethylene Capacity: 539,000 tons/year | Status: Restarted in mid-July following a May shutdown; operating at 70–80%.

Mitsui Chemicals — Chiba, Japan
Ethylene Capacity: 612,000 tons/year | Status: Restarted in early September after a June shutdown; operating at 70–80%.

Idemitsu Kosan — Tokuyama, Japan (RFCC)
Propylene Capacity: 110,000 tons/year | Status: Scheduled shutdown from September through November.

South Korean supply is expected to tighten further as two major crackers prepare for maintenance. LG Chem plans to shut its 1.3 million tons/year cracker in mid-October for approximately 45 days. KPIC is also scheduled to take its 800,000 tons/year cracker offline around the same time for roughly 40 days. The KPIC unit is currently operating at around 65%.

Taiwan’s supply is also expected to remain balanced to tight. Formosa Petrochemical restarted its 1.2 million tons/year No. 3 naphtha cracker in Mailiao in early September but plans to shut its 1.035 million tons/year No. 2 cracker in early October. Its 700,000 tons/year No. 1 cracker has remained offline since October 2025, with no confirmed restart date.

These supply restrictions could offer renewed support to spot prices once trading activity returns to normal and buyers begin covering outstanding requirements.

Southeast Asian Ethylene Prices Extend Their Correction

Southeast Asian ethylene prices declined for a third consecutive week as limited trading and persistent buyer resistance weighed on the market. The downturn marks the first reversal after a rally lasting nearly two months, prompting traders with uncovered late-October and early-November requirements to postpone purchases in anticipation of further reductions.

Weak demand from major derivative sectors, including PE, SM, MEG and EO, continued to undermine sentiment. At the same time, competitively priced alternative cargoes gave buyers more room to negotiate, despite relatively low regional inventories.

A Singapore-based trader said competitively priced US Gulf cargoes for late-November and December arrival in Northeast Asia and China had eased some supply concerns. Lower-priced Indian-origin cargoes offered into Southeast Asia had also encouraged buyers to delay purchases. However, the trader noted that prices could recover when traders face greater urgency to cover late-October and early-November shortfalls.

Suppliers from Southeast Asia, South Korea, China and India continued to offer cargoes on both fixed-price and floating-price bases. Producers sought premiums of $40–50/ton over CFR Southeast Asian assessments, while fixed-price offers eased to $1,200–1,250/ton CFR Southeast Asia. Buying indications remained much lower at $1,090–1,100/ton, underscoring the substantial gap between seller expectations and buyer willingness to pay.

In a separate transaction reported the previous week, a Western trader purchased an Indian-origin ethylene cargo for late-September loading at a discount of $40/ton to the FOB Hazira floating-price basis. The cargo was reportedly destined for Bangladesh.

Southeast Asian Cracker Operating Rates Remain Low

Ethylene supply across Southeast Asia is expected to remain constrained through October, as several major crackers continue to operate below capacity due to feedstock costs, weak margins and operational adjustments.

Southeast Asian Plant Operating Updates

PRefChem — Pengerang, Malaysia
Ethylene Capacity: 1.29 million tons/year | Operating Rate: Approximately 60–70%.

Rayong Olefins — Map Ta Phut, Thailand
Ethylene Capacity: 900,000 tons/year | Operating Rate: Around 80% following a mid-September restart. The unit had been offline since early March.

Aster Chemicals & Energy — Pulau Bukom, Singapore
Ethylene Capacity: 1.15 million tons/year | Operating Rate: 50–60% after completing a month-long planned turnaround in August.

PT Lotte Chemical Indonesia — Cilegon, Indonesia
Ethylene Capacity: 1 million tons/year | Operating Rate: 50–55%, reflecting feedstock costs and margin pressure.

ExxonMobil — Jurong, Singapore
Ethylene Capacity: 900,000 tons/year | Status: The older cracker was closed in March.

Overall, Asian ethylene markets remain caught between restricted supply and weak downstream consumption. Northeast Asian prices could find support from lower operating rates and planned maintenance, while Southeast Asia remains under pressure from cautious buyers and competitively priced alternative cargoes. The next market direction will depend largely on whether buyers return to cover near-term requirements and whether sellers can maintain their current offer levels.

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