Europe Dec MEG contract confirmed at €660/t

11 December 2009 14:45  [Source: ICIS news]

LONDON (ICIS news)--The European monoethylene glycol (MEG) December contract price was fully confirmed at €660/tonne ($971/tonne), up €28/tonne from November, with January prices set to go higher, industry sources said on Friday.

“Finally people have understood that there are not going to be lower prices in December...I am 200% convinced that prices will go up in January,” a trader said echoing comments made by a producer.

The producer recently justified the December increase by calling November’s price of €632/tonne a “big mistake”. It said the price decrease on upstream ethylene had already been passed on in October when MEG fell by €30/tonne to €640/tonne FD (free delivered) NWE (northwest Europe).

The December contract was agreed between two parties late on Tuesday and was followed on Thursday by another European producer and consumer.

Strong Asian prices had diverted interest away from Europe, causing a lack of imported material, sources agreed.

“There is nothing being shipped in December so there will be no quantities in January,” another trader said.

A 10,000 tonne Iranian shipment was scheduled to arrive on 20 December, a recipient of the load confirmed. Around 4,000 tonnes would land in Antwerp, Belgium, and would become available in due course. The rest was committed for the Mediterranean, according to other players.

Thereafter, there were no spot imports reportedly booked for Europe.

“Customers fear it could be tight in the New Year. There are no imports on the way,” a third trader said.

($1 = €0.68)

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By: Caroline Howard
+44 20 8652 3214

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