31 July 2008 09:51 [Source: ICIS news]
(adds detail in paragraphs 3-5)
LONDON (ICIS news)--An initial European ethylene August-September bi-monthly contract has been agreed at €1,228/tonne ($1,919/tonne), up €123/tonne from June-July and the same level as the third-quarter contract, a major consumer said on Thursday.
The contract, agreed on a free delivered (FD) northwest Europe (NWE) basis, was between the consumer, a major polyvinyl chloride (PVC) producer, and a major ethylene seller.
The number was described by the buyer as being the best compromise, with the seller having targeted a higher level in a bid to improve profitability due to expectations that feedstock may increase further in the period.
However, one other key buyer involved in the contract said that an increase of such a magnitude would be hard to justify given the recent 15% drop in naphtha prices over the past two weeks.
“[We will have] internal difficulties to accept this," it said. "It’s hard to understand,” it said.
($1 = €0.64)
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