05 March 2010 15:02 [Source: ICIS news]
HOUSTON (ICIS news)--The US acrylonitrile (ACN) export contract price hit a record high on Friday, causing some buyers and sellers to worry if the market is due for a correction.
The ACN export contract price for February reached 93.44-97.52 cents/lb ($2,060-2,150/tonne, €1,524-1,591/tonne) FOB (free on board) US Gulf amid higher feedstock prices and low availability. ACN contract prices are calculated via formula and then applied retroactively.
That level was an average of 5% higher from the $1,981-2,028/tonne FOB range in June 2008, near the height of the housing and commodity bubbles. ACN export prices crashed when those bubbles burst later that year, hitting a low of $640-740/tonne FOB in January 2009.
Since then, two US ACN producers - Lucite and Ascend Performance Chemicals - stopped selling to the open market. The price of chemical-grade propylene (CGP), the main ACN feedstock, also started its steady climb higher. CGP contracts grew to $1,367 tonne in February from $408/tonne in January 2009.
That caused the other suppliers in the region - INEOS and Cytec Industries in the US and Unigel in Mexico - to steadily hike up export spot prices, mainly to customers in Asia who increased their orders to meet the region’s growing economy.
Now that prices have reached new heights, buyers and even some sellers said they were worried about a potential squeeze - raw material prices continue to escalate while ACN’s record price could start to drive some buyers out of the market.
“We do feel priced are at their peak, although raw materials are still going up,” one trader said.
($1 = €0.74)
To discuss issues facing the chemical industry go to ICIS connect
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|
Asian Chemical Connections