Europe Aug PTA falls €27/tonne, in line with upstream PX drop

01 October 2010 23:59  [Source: ICIS news]

LONDON (ICIS)--August purified terephthalic acid (PTA) prices in Europe fell from July by an average of €27/tonne ($37/tonne), dropping the range to €683-704/tonne because of falling upstream paraxylene (PX) costs, sources said on Friday.

PX dropped by €40/tonne to €745/tonne FD (free delivered) NWE (northwest Europe) in the same month, as assessed by ICIS.

September PTA was still under discussion, but PX’s surprise spike of €65/tonne to €810/tonne could pressure PTA to rise back into the €700s/tonne, sources said. If prices adhere to traditional calculations, PTA would increase by €44/tonne.

Suppliers were attempting to improve their margins with October PTA pricing, but customers insisted they would not pay more than the PX pass-through.

The PTA market was described as balanced-to-tight. During the last few weeks, players spoke of availability being curtailed from a European plant, though this was not confirmed at the source.

On the other hand, the strengthening of the euro from €0.79 to €0.73 versus the dollar over the past three weeks was attracting Asian molecules into Europe, market players said.

PX recently increased to $1,025/tonne CFR (cost and freight) Asia, putting upward pressure on European prices. Buyers in Europe speculated on PX increasing by €15-50/tonne, depending on source.

Meanwhile, some expected a rollover or a slight increase of €10/tonne based on exchange rate calculations. The PX market was tight in Europe, according to sources.

($1 = €0.73)

For more on PTA or PX visit ICIS chemical intelligence
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By: Caroline Murray
44208 652 3214

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