21 May 2010 17:05 [Source: ICIS news]
HOUSTON (ICIS news)--A US butadiene (BD) producer nominated a June contract increase of 7 cents/lb ($154/tonne or €123/tonne), market sources said on Friday.
The nomination was at the same level some producers initially targeted for May contracts. But US BD contracts in May eventually settled up by 5 cents/lb from April, at 89 cents/lb, according to global chemical market intelligence service ICIS pricing.
US BD contracts usually settle at the lowest price nominated by the four main US producers. The remaining three suppliers were expected to step out with their initiatives by 28 May.
US BD supply had loosened in the second quarter after being extremely tight during the beginning of the year, as imports from Europe and Asia hit the market, sources said.
A BD buyer said the weakening of the euro had helped US BD users secure more material from Europe and could bring US contract costs down.
“It’s safe to say that EU material has been booked into the US, so it’s equating to lower numbers,” the buyer said.
US first-quarter BD production rates were a mixed picture, with supply much higher than in the same quarter of 2009 but lower than in the last quarter of that year.
However, BD production in the first quarter fell by 2.7% compared with 843m lb produced in the fourth quarter of 2009, the NPRA said.
US BD inventories in the first quarter were at 151m lb. That is up by 7.1% from 141m lb in the fourth quarter of 2009, but down by 17.0% from 182m lb in the same period one year earlier.
US BD producers include ExxonMobil, INEOS, LyondellBasell, Shell and TPC Group. Buyers include Invista, International Specialty Products (ISP), Lanxess, Michelin and Negromex.
($1 = €0.80)
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