In view of the substantial fall in the ethylene reference, price expectations on the market differed considerably. Only in exceptional cases did processors succeed in achieving a pro-rata reduction to reflect the fall in ethylene. In general, producers were able to increase their margins – a rather unusual situation for a December.

The level and scope varied widely however. Two suppliers approached the market with demands that included 25 per cent of the ethylene reduction, but failed. The range covered by the deals remained broad, with the majority being concluded at between minus €40/t ($46) and €50/t ($57).

The south-eastern European market tended to be weaker, while price reductions in the UK were less pronounced. The New Year could bring further price relief, albeit at a more moderate level. The fall in the price of naphtha has slowed down, taking pressure off the ethylene reference, which was fixed €40/t lower at €985/t ($1,135).