Europe monthly acetone MMA net contract down €400/t

09 January 2009 11:51  [Source: ICIS news]

LONDON (ICIS news)--The first monthly acetone methyl methacrylate (MMA) net-contract price was agreed at €380/tonne ($521/tonne), down 51% from the fourth quarter of 2008, a major acetone producer and acetone consumer said on Friday.

“I can confirm a monthly contract price of acetone for January at €380/tonne,” said the major producer.

The acetone MMA contract price was on a free delivered (FD) northwest Europe (NWE) basis.

The January acetone MMA contract settlement marks a decrease of €400/tonne compared with the fourth-quarter 2008 settlement of €780/tonne FD NWE.

The acetone MMA contract price, which is typically set as a quarterly price, was agreed on a monthly basis following the temporary move from quarterly to monthly contract pricing in the propylene market.

“We have made a monthly agreement for the first time ever,” said the major consumer.

“We would have preferred to keep it quarterly and wanted to avoid this (monthly agreements), because it keeps people very busy,” the consumer source said.

“Moving from a monthly to quarterly price does not surprise me, it makes sense,” said a major European acetone producer in the process of starting its acetone MMA contract negotiations.

“Acetone prices are all over the place because of the huge drop in the value of propylene,” he said.

An initial propylene contract settlement for January was reported on Tuesday 16 December at €430/tonne FD NEW, down 55% from the fourth-quarter value of €953/tonne FD NWE.

The acetone MMA contract price typically mirrors developments in the propylene contract price, although supply-and-demand dynamics play an integral role.

($1 = €0.73)

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By: Julia Meehan
+44 20 8652 3214

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