30 August 2010 07:39 [Source: ICIS news]
By Ong Sheau Ling
SINGAPORE (ICIS)--Spot propylene oxide (PO) prices in ?xml:namespace>
Prices had surged from July to hit a three month-high at yuan (CNY) 12,650-13,300/tonne ($1,860-1,956/tonne)
This had followed a price slump that lasted from May to July due to waning demand and the influx of PO from Ningbo ZRCC Lyondell Chemical’s (NZLC) 285,000 tonne/year unit in
The recent price surge was due to tighter import volumes due to an outage at SKC’s 180,000 tonne/year PO/SM (styrene monomer) unit in
Availability was also low from Chinese PO facilities based on chlorohydrin technology which had restarted normal operations only around mid-August after cutting production in mid July due to weak demand at the time, market sources said.
Key polyols producer CSPC has not been able to operate its 200,000 tonne/year unit at 100% after it shut the plant down on 31 July due to a power outage, which had exacerbated the current shortage, they added.
Polyols makers, who had maintained low PO stocks during the lull season from May to July, were now buying more PO than expected to make up for the shortfall in supply, they said.
“Three weeks before the arrival of the [PO] cargo from
“Our volumes [from the Middle East] are cut by half for August, and we need more material,” a polyols producer based in eastern
On 27 August, import prices were discussed at $1,500-1,600/tonne CFR China, an increase of $50-80/tonne over the last week, ICIS reported.
Most polyols producers preferred to buy imported PO over local material from NZLC as they would be able to claim tax rebates on exports, another east
Market players expected the bullish trend to continue through September – the traditional peak manufacturing season for the foam market which uses polyols as raw material.
While some market players believed that demand for foam from the furniture sector would grow further in the second half of 2010, others said that the rise in demand was a temporary phenomenon.
“This is just a temporary sign of improved demand, all these uncertainties make buyers like us feel worried and that is why we are buying a lot of
Some polyols producers believed that the increased
“The Asian Games based in
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