01 July 2010 12:07 [Source: ICIS news]
LONDON (ICIS news)--France's Novapex has been forced to put phenol customers on 80% allocation because of supply issues relating to benzene, a company source said on Thursday.
“We have a benzene problem which is leaving us to announce everywhere that customers are now on 80% allocation,” the source said.
Novapex was unable to give a firm timeline in relation to the allocation or specific details of the benzene problem.
The source said: “It’s open-ended... I can’t say today when this will be lifted.”
The phenol market had been plagued by planned and unplanned production problems in recent months, but even with all these issues resolved, the market remained fundamentally tight, markets sources said.
“We have the same problems INEOS had in May ahead of their shutdown... we have a [planned] shutdown in August and we can’t build inventories,” said the Novapex source.
Meanwhile, INEOS Phenol confirmed that phenol demand remained “very strong” and that product was tight.
“Phenol demand is good and, apart from the benzene contract price coming down €95/tonne, there is no movement in spot prices because product is tight and buyers are playing catch-up,” said the INEOS Phenol source.
($1 = €0.82)
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