US VAM buyers should settle Q4 for less - buyer

04 November 2008 18:12  [Source: ICIS news]

(Adds new wording for clarity in paragraph 1)

HOUSTON (ICIS news)--Buyers of US vinyl acetate monomer (VAM) who are pondering a rollover on their fourth-quarter contracts should push for lower prices, a buyer said on Tuesday.

"It's going down, big-time," the buyer said of the last-quarter VAM settlement, noting major drops in the price of feedstock ethylene and natural gas. "There's no way you can justify a rollover."

Ethylene prices fell 11% in October, natural gas dropped 8% and crude plunged 37%, according to global chemical market intelligence service ICIS pricing.

One VAM buyer said a producer had given a reduction of 2 cents/lb ($44/tonne or €35/tonne) for the fourth quarter, while another buyer said a producer was offering a 4-6 cent/lb reduction. The latter buyer also said another supplier was offering only a rollover.

But a producer said in October that customers would get rollovers, not price cuts.

The buyer who said VAM feedstock declines warranted large reductions said 5-cent/lb cuts were the minimum to be expected. "There's a good chance it's going to be more than that," the buyer said.

Most sources said final fourth quarter settlements are still a few weeks off.

US VAM contract prices were assessed at 67-71 cents/lb, according to ICIS.

Major US VAM producers include Celanese, Dow Chemical, DuPont and LyondellBasell.

($1 = €0.79)

For more on vinyl acetate monomer, visit ICIS chemical intelligence
For more on Celanese, Dow, DuPont or LyondellBasell, visit ICIS company intelligence
To discuss issues facing the chemical industry go to ICIS connect


By: Lane Kelley
+1 713 525 2653



AddThis Social Bookmark Button

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly