05 August 2009 23:59 [Source: ICIS news]
LONDON (ICIS news)--European third-quarter melamine prices have been agreed between €800-900/tonne ($1,159-1,304/tonne) on weak downstream demand and oversupply, sources confirmed on Wednesday.
The majority of buyers confirmed decreases of €50-100/tonne, while producers had noted reductions of €20-45/tonne and €50/tonne.
All players nevertheless accepted that real third-quarter values were assessed between €800-900/tonne, which reflected decreases of €100-150/tonne.
“We have now reached the bottom,” one producer said. “Industry cannot accept this price level any longer.”
The falls were caused by ongoing weak downstream demand and considerable oversupply in the market, sources said.
One supplier said that demand in the third quarter had picked up compared with the second quarter. This was echoed by several buyers, who said that some downstream markets such as the construction industry were performing above expectations.
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Players agreed that the market was balanced to long, and that it was easy to obtain good-quality domestic material.
Although the majority of sources said that there were no imports coming into Europe due to plenty of domestic material being available, one consumer did note some shipments arriving from
Those parcels could not compete with local melamine, however, which was available on the market at €800-850/tonne FD (free delivered) NWE (northwest
There was uncertainty about fourth-quarter demand and pricing. Many sources hoped that demand would increase, but one supplier said that if the market did not pick up, it would seriously consider adjusting production rates.
Second-quarter contracts were assessed between €900-1,050/tonne FD NWE, according to global chemical market intelligence service ICIS pricing.
($1 = €0.69)
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