SOUTH KOREA TO PAY MORE FOR JAPANESE ETHYLENE South Korea will pay about 20 pct more for ethylene imported from Japan in the second quarter of the year because increased plastic production in both countries has boosted demand and tightened supplies, chemical industry sources said. South Korea has agreed to pay Japanese trading houses just over 400 dlrs C and F per tonne, up from an average of 350 dlrs in the first quarter and throughout 1986, they said. South Korean demand for imported ethylene this month has risen to 17,000 tonnes from 10,000 last month, and the country may face difficulties covering the extra volume, they said. <Korea Petrochemical Industries Corp>, a producer of high density polyethylene (HDPE) and polypropylene, will more than double its ethylene requirements to 9,000 tonnes a month from 4,000 when it completes a plant expansion at the end of this month, the sources said. <Honan Ethylene Corp's> import requirements have risen to 8,000 tonnes a month from 6,000 tonnes last year to meet strong demand from <Honan Petrochemical Co>, which makes HDPE and ethylene glycol, and <Hangyang Chemical>, which produces low-density polyethylene and vinyl chloride monomer, they said. But Japan's ethylene plants are already operating at almost full capacity of 4.5 mln tonnes a year just to fulfill domestic demand, the sources said. "And even if Japan had the additional ethylene, there is a logistical problem of finding extra appropriate-sized vessels to ship it to Korea," said one trading house source. Japanese trading companies are looking to alternative sources to supply South Korea's needs, including Saudi Arabia, Qatar and Mexico, they said. But long-haul voyages are expensive as the product has to be shipped at a temperature of minus 103 degrees centigrade to keep it in a liquid form, they said. Japan has no plans to invest further in the ethylene industry in order to cope with the additional demand, despite rising prices, trading house sources said. South Korea has two projects in hand which will increase its ethylene production capacity by 500,000 tonnes a year by the end of 1989, so the strong demand surge for imports is only a medium-term trend, they said.