Indian acetone firms on higher raw material

25 June 2008 04:27  [Source: ICIS news]

SINGAPORE (ICIS news) -- Indian acetone traded higher this week due to higher international prices as well as spike in raw materials cost, industry sources said on Wednesday.


Indian acetone prices were assessed at $1,080-1,090/tonne CFR (cost-and-freight) India, up $40/tonne over last week for spot cargoes of 500-1,000 tonne.


A 1,000 tonne cargo was reported sold at $1,080/tonne CFR India for mid-July landing. Cargo was said to be of Taiwanese origin, which is subjected to an anti-dumping duty (ADD) of $87-90/tonne.


“Prices are moving higher as suppliers are unwilling to sell into India due to the high ADD,” a source said.


Margins were even lower after factoring in ADD which ranged from $150-250/tonne for cargoes of Singaporean origin.


Even Korean cargoes, which used to enjoy tariff free privileges, now face an ADD of $67/tonne.


“It really makes no sense to sell to India especially when spot prices in India are at the same levels as in Southeast Asia”, a supplier said.


“After factoring in ADD and freight costs of around $70-80/tonne, our margins will be so eroded that our prices cannot be competitive enough”, another source added.


Domestic offers remained stable at Indian rupee (Rs) 56/kg ($1.31/kg) in the port of Kandla.


Spot prices in Asia were last assessed at $1,000-1,080/tonne CFR China Main Port (CMP) and $1,050-1,100/tonne CFR Southeast Asia, reflecting higher buy-sell indications amid rising Chinese domestic acetone prices.


High benzene and propylene values continued to prompt producers to hike acetone prices.


Spot propylene prices gained $20/tonne to $1,740-1,840/tonne CFR NE Asia last Friday. Benzene values, however, lost $40/tonne to $1,290-1,300/tonne FOB Korea last week.


($1 = Rs42.75)


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By: Desmond Chia
+65 6780 4359

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