Europe bisphenol A market tight as Asia pulls material

05 February 2010 12:31  [Source: ICIS news]

LONDON (ICIS news)--Increased tightness in the European bisphenol A (BPA) market is pushing up price ideas for February, sources said on Friday.

A buoyant Asian BPA sector has been pulling material from Europe and Russia since December 2009, and kept producers in the region from shipping cargo to Europe. Seasonal shutdowns over the Christmas holiday period also put pressure on availability, as buyer interest remained healthy.

“The situation is still tight in Europe,” said one trader, adding that it did not see any volumes available for February.

“There is virtually no Asian or Russian cargo in the market,” the trader said.

Many buyers were said to be looking to cover March volumes already; an indication that players were expecting the current situation to last.

Another source said it had seen a small Russian lot for tender in the market, and expected this to sell somewhere in the range of €1,300-1,400/tonne ($1,781-1,918/tonne).

Several sources said that demand was starting to firm for the first quarter following a lacklustre January.

One buyer said that the epoxy resins sector in particular was pulling a lot of material, while another source added that, despite inventory restocking playing a role, many players were currently exporting to Asia.

“There are logistical issues,” said one source, adding: “Because of all the export business happening, loading is tight right now. This is also putting pressure on availability.”

In light of these dynamics, sources expected that February contracts would see a sizable increase from January levels, which were assessed at €1,100-1,220/tonne FD (free delivered) NWE (northwest Europe), according to global chemical market intelligence service ICIS pricing.

“I don’t see the reduction for February benzene having any real influence on BPA prices,” said one trader, adding: “It is a matter of physical availability.”

($1 = €0.73)

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By: Truong Mellor
+44 208 652 3214

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