12 February 2010 23:59 [Source: ICIS news]
LONDON (ICIS news)--European purified terephthalic acid (PTA) contract prices have increased by €40/tonne ($55/tonne) in January compared with December, in line with upstream paraxylene (PX) price movements, sources said on Friday.
“We got the PX pass-through. January was very good because of demand, because of good base demand for the time of year,” said a producer, echoing comments from another producer.
Absolute numbers were recorded between €690-720/tonne FD (free delivered) NWE (northwest ?xml:namespace>
A customer said it was having to pay over €730/tonne for the month of January and recorded its acceptance of the PX pass-through for that month.
Producers had been targeting a €10/tonne premium over the cost of PX.
But because downstream polyethylene terephthalate (PET) producers endured greater-than-expected January increases in the price of PET’s other raw material, monoethylene glycol (MEG), a PTA producer said it decided against imposing the additional €10/tonne.
“PET health is my health, so I need to take care of my customers,” said the producer.
PX prices rose by €60/tonne to €800/tonne in January and rolled over in February.
“[PTA] customers should not be running with huge inventories, because some thought that prices would drop in March,” said the second producer.
PET plants were indeed running well in
Producers of PET were attempting to raise their February prices by €50-80/tonne over January in order to compensate for failing to pass through the full upstream costs and to reflect further hikes in February.
Sources viewed MEG as balanced to tight. MEG prices soared by €125/tonne in January to €785/tonne, and February looked set to increase further, according to industry players.
February PTA discussions have yet to get under way.
($1 = €0.73)
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