06 August 2008 17:36 [Source: ICIS news]
LONDON (ICIS news)--Most buyers and traders in the European methyl di-p-phenylene isocyanate (MDI) market did not expect Bayer’s recently announced targeted price hikes of €100/tonne ($154/tonne) to be successful in August, they said on Wednesday.
The increase was announced across both pure and crude MDI and was being implemented in the wake of a higher August benzene settlement, which was agreed up €60/tonne at €900/tonne FOB NWE (free on board, northwest ?xml:namespace>
Two other producers had hinted at the possibility of price hikes for August but were unavailable for comment at the time of writing.
Market sources on the buy side, however, stated that they had not seen any increases for August yet. Numerous industry participants alluded to the fact that market fundamentals were balanced and that this would not, therefore, support increases in August.
One consumer differed in opinion, saying that Bayer was being strict with its increase which would help push it through.
Producers were hoping that scheduled turnarounds within the market, such as one at BorsodChem’s MDI plant in
Speaking on Tuesday, a source at Bayer said it was confident that planned price hikes would be successful in August and that results of negotiations so far had been positive.
The assessed July ICIS pricing range for crude MDI currently sits between €1,900-1,975/tonne FD W Europe (free delivered, western Europe), with prices for pure MDI pegged within a range of €1,955-2,050/tonne FD W Europe.
Other European producers of MDI are BASF/Elastogran, Dow, BorsodChem and Huntsman.
($1 = €0.65)
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