The first half of January 2025 witnessed a rise in prices of 2-EH across the US market due to improved demand conditions and disruptions in the production of feedstock Propylene. Demand conditions improved significantly, primarily driven by a rebound in demand from the plasticizer industries, leading to an increase in queries received. Import prices of 2-EH escalated further due to limited arrivals from Asian markets, as 2-EH plants in Taiwan and South Korea remained offline.

Winter Storm Enzo created challenging logistics and transportation conditions while causing several feedstock Propylene facilities to declare force majeures, disrupting production of 2-EH. Subfreezing temperatures, snow, and ice led to shutdowns of major petrochemical plants, widespread power outages, and concerns over the storm's impact on petrochemical markets and economic costs. Among the shutdowns, Enterprise in Mont Belvieu, TX, saw its Propylene Dehydrogenation (PDH) units, with a combined annual capacity of 4,320,000 tons, face weather-related issues, with PDH Unit 1 confirmed offline on January 22, 2025. LyondellBasell in Channelview, TX, experienced disruptions in two steam crackers with an annual Propylene capacity of 390,000 tons, including a flaring event on January 21, 2025. INEOS in Chocolate Bayou, TX, implemented winterization measures for a steam cracker with an annual Propylene capacity of 475,000 tons and remained on standby. BASF/TotalEnergies in Port Arthur, TX, shut down a steam cracker with an annual Propylene capacity of 550,000 tons on January 20, 2025, with plans to resume operations by January 24, 2025.

Adding to the challenges, the Port of Houston temporarily ceased operations due to icy conditions and hazardous roads leading to terminals. This disrupted the flow of goods critical to supply chains, including petrochemical exports and essential imports. The closure amplified the economic ripple effects of Winter Storm Enzo. The Port of Houston resumed normal operations on January 23, with container terminal gates opening at 6 a.m.

Export conditions of 2-EH deteriorated as weekly railcar loadings fell by approximately 1.3% in the week ending January 10, 2025, leading to some inventory accumulation in warehouses. Demand for 2-EH remained positive as housing starts surged in December, rising by 15.8% to the highest pace since February. This offset anticipated declines and spurred multiple inquiries from downstream plasticizer industries.

Overall, 2-EH prices improved across North America, with export and import prices rising by approximately 1.8% as disruptions persisted in Asia and inland North America. Import prices increased further due to the prolonged offline status of major facilities like Nan Ya Plastics, resulting in 250,000 MT/year of 2-EH capacity. Feedstock Propylene price increments further drove the rise in 2-EH prices as China and Taiwan prepared to reduce operating rates for the Lunar New Year, limiting supplies to North America. Operating rates for 2-EH in Asia were reported to have fallen by 1% over the week due to operational issues at new production facilities.

Anticipation prevails that 2-EH prices across North America will continue to rise, supported by force majeures limiting feedstock Propylene availability and scarcity in the Asian market. Reduced production in Asia as the Lunar New Year approaches is expected to further tighten supply. These factors collectively underpin the upward momentum in 2-EH prices, sustaining robust market conditions.