Asia crude glycerine prices set to rise on global tight supply

12 October 2010 06:33  [Source: ICIS news]

SINGAPORE (ICIS)--Prices of crude glycerine in Asia may continue rising in October on the back of global tight supply, a trader said on Tuesday.

Crude glycerine prices were last assessed at $225-235/tonne (€162-169/tonne) CIF (cost, insurance, freight) China Main Port (CMP) on 6 October, up $10-15/tonne from 8 September, according to ICIS.

“With Argentina and Brazil sold out for October and early November, we are likely to see higher prices of crude glycerine in the coming weeks,” the trader added.

South America is the largest crude glycerine producing region in the world due to the booming biodiesel production in that region, a China-based buyer said. Glycerine is a by-product of biodiesel production.

“US was heard buying huge amounts of crude glycerine from their southern neighbours,” the trader said.

The unexpected surge in demand for crude glycerine in China, the largest buyer in Asia, had also aggravated the current tight supply situation, the buyer from China said.

“Nobody was expecting China to resume buying activity for crude glycerine so soon after the mid-autumn festival as their previous stock levels were high,” a Malaysian biodiesel producer said.

Most Chinese buyers had possibly increased purchases to shore up inventories in anticipation of even higher prices in the coming weeks, the producer added.

($1= €0.72)

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By: Serena Seng

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