13 April 2010 16:15 [Source: ICIS news]
LONDON (ICIS news)--The European acetone market was divided on Tuesday about whether the value of spot acetone would hit the €1,000/tonne ($1,351/tonne) mark during the second half of April because of ongoing tight supply and strong demand.
Some European producers were convinced that the price would reach €1,000/tonne FD (free delivered) NWE (northwest Europe) because of supply constraints, not only in ?xml:namespace>
The producer said that it was now seeing spot acetone offered above €900/tonne FD NWE because of the strong demand. “I am not sure if we will hit €1,000/tonne, but it won’t be far away,” he said.
A second producer said that it was “being pounded” by customers for additional volumes. “Acetone is a hot product at the moment. April will remain strong and prices will continue to rise... acetone will move to €1,000/tonne in certain regions,” he added.
The producer described acetone as a “true global commodity”, quoting various global outages as compounding the tight situation.
Indeed, the value of spot acetone in
Meanwhile, an active European distributor doubted that spot acetone would hit €1,000/tonne FD NWE.
“The market is not long but I don’t see it is really tight. Acetone is still under pressure but I doubt it will get to €1,000/tonne, this is too ambitious,” he said. “There is too much panic in the market right now. If there were stocks or a buffer we would feel it,” he added.
The distributor source quoted €840-850/tonne FD NWE as its market price.
However, a trader source was less sanguine about the supply and demand dynamics of the market. “I talked to distributors and the numbers were €850-870/tonne FCA [free carrier alongside] and I could only secure one truck.”
The trader referred to the events of October 2009 when spot acetone reportedly sold at a record high of €1,300/tonne.
“You need [to be brave] to buy a big parcel. Look at last October, everybody bought big, the market collapsed and we didn’t return to normal until February this year,” he concluded.
Around 90% of acetone production is via the cumene route to make phenol, whereby 0.62 tonnes of acetone is produced with each tonne of phenol.
Benzene and propylene are feedstocks for the production of cumene.
($1 = €0.74)
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