US epoxy resin hikes uncertain in oversupplied market

27 October 2009 19:39  [Source: ICIS news]

HOUSTON (ICI news)--US liquid epoxy resin (LER) producers are struggling to implement fourth-quarter price increases of 6 cents/lb ($132/tonne, €88/tonne) or more - as demand and capacity utilisation remain in the doldrums, buyers said on Tuesday.

“One of my suppliers has dug in their heels [on the increase], and another has gotten more aggressive and gone down in price,” a source said.

Another buyer had secured flat pricing through the end of 2009, but said higher crude oil prices would bring on a renewed cost push in January.

Several distributors of imported resin said prices have remained flat in the fourth quarter.

“I think prices will be flat later this year,” a distributor said. “We could see a price increase in [the first quarter], depending on commodity pricing.”

A seller said epoxy resin demand improved 15-20% in October compared with the previous month, attributing the increase to post-summer holiday restocking, a drop in imports and possible market share gains.

Epoxy resin suppliers saw no major demand improvements on the horizon, with the possible exception of oilfield applications.

Higher oil prices have helped get stalled petroleum production projects off the ground, sources said.

One source in the oilfield sector said improvements were mainly seen in international markets, however.

US bulk LER prices for mid-volume customers were at $1.00-1.08/lb according to global chemical market intelligence service ICIS pricing.

Major US epoxy resin producers include Hexion Specialty Chemicals, Huntsman and Dow Chemical.

($1 = €0.67)

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By: David Barry
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