01 September 2009 23:39 [Source: ICIS news]
HOUSTON (ICIS news)--US ethylene glycol (EG) producers are still pushing for 5-6 cent/lb ($110-132/tonne, €77-93/tonne) price hikes that were to go into effect on Tuesday amid tightening supply, sources said.
It was too soon to know if the price-hike initiatives would succeed, a reseller said, adding that the growing imbalance of supply to demand was providing at least some price support.
One of Dow Chemical’s ethylene oxide/ethylene glycol (EOEG) units at St. Charles Operations in Taft, Louisiana, was being converted to EO-only production, taking some EG off the market. A second unit at the facility was idled in March, and will be taken down permanently when the conversion of the first unit is completed.
An EG unit at Formosa Plastics was also down for a turnaround. That could affect market supply if Formosa depleted inventory and entered the market as a buyer, the trader said.
Recent US EG exports to Europe also contributed to the tight supply situation when exporters anticipated supply from new plants in the Middle East that were delayed, the trader added.
While supply was tightening, demand was rising from an increase in antifreeze buying ahead of the coming winter, further contributing to the market imbalance.
US EG suppliers include Equistar, Huntsman, MEGlobal, Old World, SABIC and Shell.
($1 = €0.70)
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