03 October 2007 20:45 [Source: ICIS news]
(Adds update in paragraph 1)
Having refused another offer below €400/tonne on Tuesday, one Methanex customer said “it’s too high and we don’t accept €390/tonne”.
“It is damaging to the downstream production of derivatives,” he added.
Another large consumer was still vying for €340/tonne as a possible contender for the European contract price.
Fourth-quarter discussions were ongoing following reports from both the buyer and seller sides that a level of €370/tonne could also be a contender as a European contract price.
“I heard two players had settled at €370/tonne,” another customer said, commenting on market talk on Tuesday.
Methanex’s figure was €40/tonne below Helm’s earlier proposal for the European fourth-quarter contract of €430/tonne and its controversial monthly figure of €405/tonne for October. Helm was not available for comment.
This came after Helm’s re-evaluation of supply and demand which prompted it to pull its original suggestion of €340/tonne.
The third-quarter figure was €218/tonne FOB (free on board) Rotterdam, but a global shortage of methanol resulted in talks of significant price hikes for the fourth quarter.
Argentine natural gas accounts for 60% of Methanex’s consumption in Chile, feeding the production of 2.3m tonnes of methanol annually.
European methanol producers include Statoil, BASF, Helm and BMCN.
(Additional reporting by Al Greenwood)
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