US Q2 BDO contracts settling at hikes of 10 cents/lb

19 April 2010 22:53  [Source: ICIS news]

HOUSTON (ICIS news)--Second-quarter US butanediol (BDO) contracts are settling at increases of 10 cents/lb ($220/tonne, €163/tonne) under tight supply conditions, sources said on Monday.

Major US suppliers had nominated 10 cent/lb hikes at the start of March, driven by supply shortages while downstream demand spiked.

At least two producers said they recently had no problems getting buyers to accept the full increases for second-quarter contracts due to limited supply.

Issues, however, have arisen over ensuring supply, sources said.

One US supplier is in a four-week turnaround this month, adding to the snugness in global supply.

Any buyers taking more-than-forecast amounts from the supplier would be assessed a premium to the already increased second-quarter price, the source said.

Another US BDO supplier said it had requests for material from new customers, who cannot secure sufficient product from their regular source.

The second BDO supplier also explained that the BDO and derivatives demand remained robust. As a result, they were having difficulties filling all of its customers' orders.

The limited supply will likely continue at least through the third quarter, a producer said.

Major US BDO suppliers include BASF, Invista, International Specialty Products (ISP) and LyondellBasell.

($1 = €0.74)

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By: Ryan Hickman
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