26 September 2008 23:59 [Source: ICIS news]
LONDON (ICIS news)--European ethylene oxide (EO) contracts were agreed at a rollover in September, as the spate of turnarounds was played off against lower feedstock costs in Q4 and stable-to-softer demand, market players said on Friday.
The September EO range was assessed at €1,326-1,526/tonne ($1,950-2,244/tonne) FD (free delivered) NWE (northwest Europe) and €1,396-1,596/tonne FD MED (?xml:namespace>
A few sellers had previously expressed the intention to increase spot prices in September on the back of planned and unplanned outages during the month. However, there were no reports of any business concluded at the higher level.
Buyers considered that any plans to raise prices in September were thwarted by the reduction in Q4 feedstock costs and slower off take. However, manufacturers in northwest
Attention was now focused on October pricing, following the Q4 ethylene settlement. Formula-related business was expected to decrease by approximately €89/tonne, in line with an average 82% of the Q4 ethylene movement. For freely negotiated contracts, sellers were determined to remain firm on pricing and were reluctant to concede the feedstock relief in Q4, citing the need to recoup lost margins.
EO is primarily used in the production of ethylene glycols, which in turn are utilised to make polyesters and anti-freeze.
($1 = €0.68)
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