29 September 2010 23:59 [Source: ICIS news]
LONDON (ICIS)--The September adipic acid contract price was unchanged from August despite a €35/tonne ($47/tonne) increase in the value of the benzene contract, producers and consumers said on Wednesday.
“We have seen some decrease in the benzene spot price in September and will see it in October too. But we will look for an increase in October to recover what we lost in September,” a major producer said.
Demand remained strong and the producer’s stock position was “sold-out” for October. However, following consecutive hikes in the adipic acid contract, even when feedstock benzene was falling, producers deemed it fair to settle the September contract at a rollover.
“For September contracts the final outcome was a rollover because we need to be fair to our customers. We have restored our margins and customers have been paying more month after month,” a second major producer confirmed.The pre-discounted September adipic acid contract price was agreed at €2,315-2,385/tonne FD (free delivered) NWE (northwest Europe).
September benzene settled at €703/tonne FOB (free on board) NWE.
Adipic acid buyers in Europe also spoke about contract price rolling over despite a tight feel to the market and benzene firming.
“We have rolled over our contract price again in September but this does not make the market long, it’s still rather tight,” said a buyer for the polyurethane market.
Although the market remained structurally tight, availability had improved following various planned summer shutdowns, producers and consumers agreed.
Exports from Europe to Asia have eased, with European suppliers preferring to sell in local markets.
“Demand in China always slows during the Golden Week holidays and anyway we prefer to stay in Europe because we are a European company,” concluded one producer source.
($1 = €0.74)
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