Europe March toluene confirmed up $20/tonne

04 March 2008 12:41  [Source: ICIS news]

LONDON (ICIS news)--March toluene contracts have been settled within the range $915-925/tonne, up $20/tonne from Feburary on higher energy and spot values, a major consumer and producer confirmed on Tuesday.

The contract, which is settled on an FOB (free on board) NWE (northwest Europe) basis, had been agreed by a major producer and consumer at $915/tonne FOB NWE on Monday, with a second producer saying that it had settled within a range of $915-925/tonne FOB NWE.

Other sources said that the $915-925/tonne range was representative of their settlements, although they would not be drawn to give an exact figure.

“I think the lower end of the range, $915/tonne, is pretty representative of where the market was in February,” said a buyer source not involved in the contract mechanism. “But spot and energy have been up above and beyond that, so it makes sense.”

Crude oil and gasoline values, major contributing factors to toluene pricing, reached new record highs during February, whilst spot toluene price ideas had increased $40-50/tonne.

However, players said that greater increases had not been possible because they would not be supported by supply-demand fundamentals.

Demand was seen as low, and mooted arbitrage opportunities to the US had been made difficult by fluctuating values in the region, leaving European traders with more material in storage than they had hoped for.

With demand in the US being talked up ahead of the driving season, sellers said that they hoped to see an upturn in interest in March and April.

($1 = €0.66)

For more on toluene see ICIS chemical intelligence

By: Peter Salisbury
+44 20 8652 3214

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