Europe May PX heard €38/t up, players seek clarity

09 May 2008 17:18  [Source: ICIS news]

LONDON (ICIS news)--Europe May paraxylene (PX) players were searching for clarity on Friday after an initial May contract was heard settled at a €38/tonne ($58/tonne) increase but a major producer said it would not follow that settlement.

May business was heard settled by an European buyer at €858/tonne ($1,320/tonne) FD (free delivered) NWE (northwest Europe) with a major producer on Friday afternoon, €38/tonne up on April.

The buyer’s purported contract partner, however, was not available for comment.

Whilst buyers said that they would grudgingly follow the settlement once it was confirmed, a source at a major producer said that it did not expect to settle at the number.

“We will not follow this number,” the source said. “It is just not economically unviable - we are already considering bringing production down because of economic necessity.”

Buyers were equally bearish with the rumoured settlement seen by some as “too high”, as it was above the Asian contract price (ACP) of $1,290/tonne FOB (free on board) Asia, which was seen as being “€840/tonne at the highest” in euro terms by buyers.

Buyers and sellers alike hoped that confirmation of the settlement, or further finalised contacts, would allow for clarity in the market, but few thought that a settlement was now likely before the following Monday 12 or Tuesday 13 May.

Negotiations had been stalled by the late settlement of contract in Asia at a lower than expected number.

($1 = €0.65)

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By: Peter Salisbury
+44 20 8652 3214

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