Asia February VCM offers rise $100/t on strong feedstock cost

20 January 2010 03:46  [Source: ICIS news]

SINGAPORE (ICIS news)--Asian vinyl chloride monomer (VCM) cargoes for February delivery have been offered at $100/tonne (€70/tonne) higher than January’s settlement levels due to rising feedstock costs, market players said on Wednesday.

Japanese material was heard offered this week at $870/tonne CFR (cost and freight) NE (northeast) Asia, compared with January’s levels of $770/tonne CFR NE Asia, they said.

VCM producers said the price increase was necessary due to rising values of feedstock ethylene.

Prices of ethylene in Asia had risen by 10% since mid-December to $1,270-1,320/tonne CFR NE Asia, according to global chemical market intelligence service ICIS pricing.

Buyers were sceptical that the price increase was justified.

Current values in the downstream polyvinyl chloride (PVC) market in China only supported, at most, VCM prices of $800/tonne CFR NE Asia, said a Chinese vinyls producer and VCM importer.

With PVC demand likely to weaken in February amid the Lunar New Year holidays, VCM buying interest was also likely to be subdued, the Chinese vinyls producer added.

($1 = €0.70)

For more on VCM, visit ICIS chemical intelligence
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By: Ng Hun Wei
+65 6780 4359

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