Europe May PA looks set for €10-20/tonne hikes

09 May 2008 16:18  [Source: ICIS news]

LONDON (ICIS news)--European phthalic anhydride (PA) producers were targeting an increase of €20/tonne ($31/tonne) on the upstream orthoxylene (OX) settlement in May discussions, buyers and sellers said on Friday.

“Demand is surely picking up a little and we expect to see most of our contracts paying an additional €20/tonne,” one seller said.

Buyers, however, said they were again hoping to gain some relief through the contract negotiations, citing a weakening market and difficulties passing price increases through in the downstream unsaturated polyester resins (UPR) sector.

“Discussions are still ongoing, but we expect to get a little less than plus €20/tonne. On some contracts we believe we will escape with plus €10-15/tonne,” one buying source said.

“Theoretically we are entering the peak season, but there is a big question mark now. Product is readily available and demand is down so I don’t see them being able to pass on the full costs,” another added.

Contracts were expected to be fully established within the next week.

The European May orthoxylene contract was settled at €840/tonne ($1,313/tonne), up €20/tonne, while April PA contracts were settled at increases of €20-30/tonne.

($1 = €0.65)

For more on phthalic anhydride visit ICIS chemical intelligence

By: Shelley Kerr
+44 20 8652 3214

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