UpdateUS TDI prices rise in September, fight brews over October

10 September 2009 19:34  [Source: ICIS news]

(adds updated price nominations, paragraph 4)

HOUSTON (ICIS news)--Price hike nominations made at the end of May and early June for US toluene di-isocyanate (TDI) were fully implemented in September, but a fight was brewing over newly proposed increases, buyers said on Thursday.

Before September, producers were largely unable to push through price increases nominated in May and June due to weak demand for downstream polyurethane (PU) foam, sources said.

“[PU] demand in June was non-existent,” a TDI buyer said. “July saw a very slight improvement and August was improved on that.”

October pricing was on the horizon as producers nominated double-digit price increase nominations, buyers said. TDI producers nominated new price hikes of 10-20 cents/lb for 1 October, sources said.

US domestic bulk TDI prices were assessed at a range of 133-153 cents/lb ($2,932-3,373/tonne or €2,023-2,327/tonne) DEL (delivered), according to data from global chemical market intelligence service ICIS pricing. 

Sources said the market was artificially tight because producers had reduced production levels to make supply short and push up prices.

“In essence, there are only two TDI producers in the US because one producer does not run regularly and is participating in the market less and less,” a market participant said.

Values of toluene, a building block for TDI, increased steadily since the beginning of 2009, peaking in mid July at $2.71/gal.

In recent weeks, US toluene spot values have slipped lower on weaker energy and the end of the summer driving season.

TDI is a feedstock chemical used in the production of PU foams, which are used extensively in the automotive and furniture sectors.

Major US TDI producers include Dow Chemical, BASF and Bayer.

($1 = €0.69)

For more on TDI, visit ICIS chemical intelligence
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By: Leela Landress
+1 713 525 2653

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