Some US spot chemicals slip as buyers stand pat

22 January 2008 18:44  [Source: ICIS news]

By Stephen Burns

US chems keep watch on financial turmoilHOUSTON (ICIS news)--Some key US chemical spot values were heading lower on Tuesday amid the turmoil in global financial markets, but most traders were content to wait and see how the situation would pan out.

US financial markets reopened on Tuesday after a three-day long weekend. A few traders were at their desks on Monday, but there was no substantive business done.

The uncertainty in the financial markets "makes buyers reluctant to purchase", one polymers trader said.

In the aromatics sector, January benzene was assessed around $3.43-3.45/gal (€2.37-2.38/gal) FOB (free on board) HTC (Houston-Texas City) on Tuesday, down from $3.46-3.48/gal on Friday.

Toluene was also softer, according to a Houston-based aromatics broker, but no specific levels were clear in the absence of firm price indications. January toluene was at $2.79-2.81/gal FOB HTC on Tuesday.

Downstream, the styrene reaction was muted.

"Nothing is really going on in styrene," said a major North American supplier. "It is too early to really look at a reaction in this market, due to the winter doldrums."

Styrene activity was not expected to pick up again until late February after the Chinese New Year, which market sources regard as a typical cycle.  

In the olefins market, refinery-grade propylene (RGP) was heard traded at 56.5 cents/lb ($1,245/tonne) on Tuesday, around steady with the levels seen over the last two weeks.

There were no fresh price indications for ethylene, with trading described as slow.

US Gulf methanol spot prices were softer on Tuesday, but the slip was seen as a continuation of a downward slide from the record highs of the fourth quarter.

A February methanol barge offer was heard at $1.55/gal FOB on Tuesday morning, compared with Friday’s January bid/offer assessment of $1.65-1.75/gal FOB.

A US supplier said the latest developments in the financial markets would not have much effect on methanol buying sentiment.

Energy values were also easing on Tuesday morning.

Around 11:30 Houston time (17:30 GMT), NYMEX crude oil futures were down $1.20 at $89.37/bbl, while reformulated blendstock for oxygenate blending (RBOB) gasoline futures were down 3.08 cents at $227.26 cents/gal.

Natural gas futures were down 29 cents at $7.70/m Btu.

(Additional reporting by Brian Balboa, William Lemos and David Barry)

By: Stephen Burns
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