16 May 2008 08:38 [Source: ICIS news]
SINGAPORE (ICIS news)--Trading activity in the Asian bisphenol-A (BPA) market remains stymied by the wide gap in buy-sell ideas, as high raw material prices kept fresh offers out of reach for most buyers, traders and producers said on Friday.
Selling ideas from regional producers were maintained above $1,800/tonne CFR (cost and freight) China, as recent surges in feedstock benzene and propylene prices kept BPA offers firm.
Benzene was assessed at $1,235-1,250/tonne CFR NE (northeast) Asia during the week, while propylene was traded at $1,450-1,500/tonne CFR NE Asia, according to global chemical intelligence service ICIS pricing.
"We cannot sell BPA below $1,800/tonne. If buyers are unwilling to accept our prices, we will cut [BPA] production and focus on [upstream] phenol and acetone sales instead," a source from South Korean producer LG Chem said in Mandarin.
Other sellers agreed, with a source from Taiwanese BPA major Nanya Plastics adding that they could barely cover their variable costs at their current BPA offer of $1,800/tonne.
Still, with Chinese buying interest lacklustre due to comparatively low domestic prices, few fresh fixtures were reported in recent weeks.
Buying indications from traders and end-users were reported at around $1,750/tonne CFR China as some traders, saddled with excess inventories, offloaded bonded warehouse material at these levels.
"Many traders made losses as they sold cargoes below their buying price," a China-based BPA trader said in Mandarin. A supply overhang had built up in China over the past two months due to earlier speculation that prices would pick up.
"The current offers from regional producers are too high – if I buy cargoes at this point of time, I’ll be giving money away," he added.
BPA majors in Asia include Nan Ya Plastics, LG Chem, Chang Chun Plastics, and Mitsui Chemicals.
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