26 October 2005 11:58 [Source: ICIS news]
LONDON (ICIS news)--European fourth quarter cyclohexane contracts looked set for a split settlement for the first time this year following the agreement of two different contract deltas, buyers and sellers said on Wednesday.
A contract delta of Euro135/tonne was agreed late on Tuesday evening between a major producer and one of its customers. Both parties confirmed the agreement today. The producer said this number has been offered to its other customers, but added that it had only been accepted by one buyer so far.
This followed a settlement of Euro126/tonne, which was agreed on 14 October between BP Refining and Petrochemicals (BPRP) and its major customers.
At least one consumer has now accepted both figures, but there was no indication as to which figure would be likely to prevail. One producer speculated that Euro135/tonne may become the new market number, but other market players believed that both numbers could be legitimately followed. A number of producers have not yet indicated which of the two figures they were likely to follow, although at least one has previously dismissed Euro126/tonne as far too low.
Dissatisfaction with the delta has been a recurrent theme in 2005. Producers have contested settlements in both the second and third quarters this year, although this is the first time that two separate numbers have emerged in 2005.
Both figures represent a significant increase on Q3, when the delta was agreed at Euro107/tonne.
Combined with recent benzene price increases, total cyclohexane prices are likely to rise by Euro85-94/tonne from September to October. October benzene contracts were settled at Euro731/tonne free on board (FOB) Northwest Europe (NWE), an increase of Euro66/tonne.
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