Europe oxo-alcohol, plasticiser prices rise on tight supply

12 March 2010 23:59  [Source: ICIS news]

LONDON (ICIS news)--Oxo-alcohol and plasticiser prices rose this week due to tight supply, solid European demand and surging export prices, market sources said on Friday.

Spot prices for isobutanol (IBA) and n-butanol (NBA) were assessed at €990-1,010/tonne ($1,356-1,384/tonne) FD (free delivered) NWE (northwest Europe), up €15/tonne from the previous week, according to data from global chemical market intelligence service ICIS pricing.

Producers said they would continue to seek price increases into April as buyers scrambled to get what they needed in the market.

“Demand is too high … so we are increasing and continuing to increase,” one producer said. “We have a window today to regain margin, and we cannot pass it up.”

Narrowing supply, solid demand and firming market sentiment also nudged prices up for 2-ethylhexanol (2EH) to €1,080-1,100/tonne FD, a €15/tonne increase.

Meanwhile, prices in the plasticiser markets moved up even more quickly, as export demand and reported production problems limited supply in Europe.

Dioctyl phthalate (DOP) prices moved up €30/tonne to €1,075-1,100/tonne FD, and di-isononyl phthalate (DINP) climbed to  €1,120-1,200/tonne FD.

One producer remained on sales control for NBA, 2EH and DOP, and did not expect to have more material for the spot market until June. Other producers reported a surge in demand from irregular sources, driving speculation about production troubles.

In the DINP market, one large supplier reportedly notified customers that it would not be able to supply them at the levels they had expected. This could not be confirmed with the producer, but other market sellers reported an increase in demand from that producer’s usual customers.

Moreover, producers reported strong demand for both DOP and DINP in North Africa, Asia and the Americas, with several deals completed above European ranges.

Firming export demand also led to rising prices in the export market for oxo-alcohols, as the only obstacle sellers reported was lack of product to ship abroad. Based on completed deals, the price range for NBA and IBA was assessed at $1,550-1,600/tonne FOB Rotterdam, up $100/tonne from the previous week.

Similarly, 2EH export prices were also reportedly higher this week as demand grew from both Asia and the US. Producers reported turning down requests due to lack of product, and prices were assessed up by $100/tonne to $1,600-1,650/tonne FOB NWE.

Producers and traders expected increases for all oxo-alcohols and plasticisers to continue, as upstream propylene supplies remained tight and sources speculated that a price increase would be implemented on the back of firmer naphtha as well as the tight supply and demand balance.

 “The question is, to what level will they go and when is the end of the increases,” one trader said.

 ($1 = €0.73)

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By: Libby George
+44 208 652 3214

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