08 September 2006 10:51 [Source: ICIS news]
LONDON (ICIS news)--European spot propylene (C3) prices have reached record highs, with deals reported in excess of €1,000/tonne amid tight supplies and strong demand, buyers and sellers said on Friday.
One large 13,000 tonne propylene cargo was due for arrival in Europe in the first half of October and had reportedly attracted interest from a handful of integrated producers. Landed prices were reported in the low €1,000s/tonne cost, insurance and freight (CIF) Northwest Europe (NWE).
Robust derivative demand had led to concerns regarding supply during an extensive cracker shutdown period, leaving those with short positions with no option but to source more expensive US volume. These concerns were recently heightened by the unexpected shut down of Shell’s two Wesseling, Germany crackers earlier this week.
Market sources anticipated a tight supply and demand balance through September and October, barring any unforeseen production problems on downstream derivatives.
“These numbers may not be repeatable because of higher freight rates ex US Gulf and higher FOB [free on board] Houston values; all traders are hunting for tonnes in the US,” a key trader said.
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