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)
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