20 June 2006 07:25 [Source: ICIS news]
SINGAPORE (ICIS news)--Asahi Kasei Chemicals, the Japanese major, has raised July acrylonitrile (ACN) contract nominations by 2% due to rising feedstock costs, a company official said on Tuesday.
“Feedstock propylene costs and high upstream naphtha values have severely eroded our margins. Our production costs, as a result, have risen sharply and we have no choice but to increase our July nominations,” the source added.
The July nomination was $1,630/tonne CFR Asia, $30/tonne higher than in June.
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Asian propylene spot prices have held firm at $1,050-1,080/tonne CFR Northeast Asia in the past month, while naphtha spot prices have hovered at $600-620/tonne CFR Japan for most of 2006 and pushed production costs up for Japanese petrochemical firms.
Acrylic fibre (AF) producers, who are major ACN end-users, are likely to resist the price increase. Negotiations over June contracts are still in a deadlock due to a hefty jump in prices for this month.
Spot ACN prices were at $1,490-1,560/tonne CFR Asia on Tuesday, up $70-100/tonne from a month ago.
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