19 December 2007 11:50 [Source: ICIS news]
LONDON (ICIS news)--European olefins buyers and sellers were closing in on fixing first-quarter contracts at significant increases as producers looked to manage record upstream costs, key participants said on Wednesday.
"Currently the offers we are receiving for first-quarter ethylene are increases in the low €80s/tonne, with propylene in the low €60s/tonne. This is more than I want but we are coming closer," said one large purchaser.
The gap in price ideas for the ethylene increase seemed narrower, with the €65/tonne ($94/tonne) bi-monthly December-January hike now more of a floor target level for some buyers.
Certain producers had been aiming for plus €100/tonne but the gap on Wednesday seemed more focused between the plus €70s-80s/tonne.
"Discussions on propylene look more difficult as the market has been weak for some time and supply has been good, but the cost pressure is still there," said one seller.
Sources had previously agreed that propylene prices were likely to move up less than ethylene.
($1 = €0.69)
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