27 March 2008 18:05 [Source: ICIS news]
LONDON (ICIS news)--An initial second-quarter methanol contract has been agreed at €295/tonne ($460/tonne), down €195/tonne from the first quarter on ample supply and a weak spot market, a BASF company source said on Thursday.
“This is only the first settlement. I assume that all consumers will follow, but some sellers may still have their problems,” the BASF source said. “I think this is a good market price in relation to prices in the
Producers had been holding out for a price in the mid-€300s/tonne, saying that they preferred not to overshoot the decrease for fear of another big swing in the third quarter following a €110/tonne hike from the fourth quarter of 2007 to the first quarter.
Buyers were adamant from early on that the contract price should fall below €300/tonne, stating that they had been at a huge disadvantage after the first quarter price was settled up €110/tonne and the spot market swiftly fell back down to pre-contract levels and below.
Buyers said they were unable to pass first-quarter costs on to their customers due to the drop in spot values and that the second-quarter settlement should reflect this disadvantage.
($1 = €0.63)
For more on methanol visit ICIS chemical intelligence
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|