11 March 2009 16:10 [Source: ICIS news]
HOUSTON (ICIS news)--Spurred by a shrinking supply of raw material, refined glycerine suppliers in the US are positioning themselves to hike contract prices by 5-10 cents/lb ($110-220/tonne, €87-174/tonne) for the second quarter, sources said on Wednesday.
The increase would bring contract prices as high as 45-55 cents/lb. That would be the first increase since contract prices started sliding from average highs of 100 cents/lb for vegetable-based glycerine and 80 cents/lb for tallow-based material in the third quarter of 2007.
A steep cutback in biodiesel production has shrunk the pool of crude glycerine, the renewable fuel’s co-product. That led refined glycerine suppliers to propose price hikes for customers nervous about access to supply.
“Customers will fight any increase, but I think they’ll have no choice. No one will lose business,” a distributor said of the proposed increase.
Suppliers and buyers were still debating whether contract prices for vegetable-based and tallow-based material would diverge after coming together in first-quarter 2009.
Major US suppliers include Archer Daniels ?xml:namespace>
($1 = €0.79)
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