15 January 2009 15:42 [Source: ICIS news]
LONDON (ICIS news)--The first monthly acetone methyl methacrylate (MMA) gross or "pre-discounted" contract price was agreed at €475/tonne ($625/tonne), down 51% from the fourth quarter of 2008, a major acetone consumer and one of its suppliers confirmed on Thursday.
"I can confirm that €475/tonne is a monthly price because we don’t know what is going on with propylene," said the producer. The producer normally agrees contracts on a quarterly basis.
The acetone MMA "pre-discounted" contract price was on a free delivered (FD) northwest Europe (NWE) basis.
The January acetone MMA contract settlement marks a decrease of €500/tonne compared with the fourth-quarter 2008 settlement of €975/tonne FD NWE.
The net acetone MMA contract, which is typically set as a quarterly price, was first agreed as a monthly settlement on 9 January, between a major producer and consumer.
The "net" contract price was agreed at €380/tonne FD NWE, also down by 51% from the fourth quarter of 2008 and marked a 20% differential between the gross and net numbers agreed so far.
A major producer also involved in the acetone MMA contract said that it "was not surprised" about the move from quarterly to monthly contract negotiations and expected to start negotiations this week.
An initial propylene contract settlement for January was reported on 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 also play an integral role.
Meanwhile, in the acetone spot market, prices have dropped dramatically on the back of poor demand and falling propylene values.
Spot acetone was valued at €450-520/tonne FD NWE this week, down €160-180/tonne from December 2008, according to global chemical market intelligence service ICIS pricing.
($1 = €0.76)
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