Strong demand fuels Europe epoxy resin market

09 May 2007 18:17  [Source: ICIS news]

NUREMBERG (ICIS news)-- European epoxy resin market growth was estimated to have averaged 6-7% so far this year due to strong demand, traders said on Wednesday.

 

Composite resins registered the greatest growth among resins, hitting almost 12%, resellers added.

 

This was mainly attributed to the current strength of the European wind turbine industry where they are used in blade manufacture.

 

Standard liquid epoxy resins have also performed well this year, exhibiting a more modest growth rate of around 3-4%, driven by the construction and civil engineering industries, sources said.

 

May contracts were still outstanding, although several players reported settling contracts at a rollover.

 

One European major was said to have increased prices across the board in an attempt to build up stocks ahead of a planned outage.

 

April contracts for European standard liquid resins were assessed at €2,770-2,920/tonne ($3,743-3,946/tonne) on a FD (free delivered) NWE (northwest Europe) basis, according to global chemical market intelligence service ICIS pricing.

 

Upstream phenol and bisphenol A (BPA) production issues remained a concern for epoxy producers.

 

According to one, there has been a disconnection between BPA and epoxy resin prices for some time, with the epoxy market driven more by the prevailing supply and demand situation rather than BPA costs.

 

It would therefore take a significant increase in BPA prices to push epoxy prices up further. Reduced production rates of epoxy raw materials would tighten the market, the source added.

 

With the other main feedstock, epichlorohydrin (ECH), currently well balanced, according to one trader, it may prove difficult to implement any increases on resins.  

 

Despite the current strength of demand, several buyers said epoxy resin price decreases could well be possible, as material continued to be easily available.

 

Producers on the other hand agreed that the market was stable, but added that stronger offtake was still to come.

 

One major said: “Structurally the European market is tight, even with the new plants coming on line and planned expansions. It is only imports which have kept it stable in the last few months.”

 

($1 = €0.74)

 

 

By: Adal Rafiq
+44 20 8652 3214

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