05 November 2010 23:59 [Source: ICIS news]
LONDON (ICIS)--The European November phenol contract price increased by €36/tonne ($51/tonne) from the previous month, following the November benzene contract settlement, phenol producers and consumers said on Friday.
November phenol settled on a pre-discounted basis at €1,197-1,237/tonne ($1,710-1,767/tonne) FD (free delivered) NWE (northwest Europe), up €36/tonne in line with the November benzene contract price.
“The benzene increase will automatically be passed on for contract and spot,” said a major producer.
A second major supplier said: “Phenol is a very tight product and the benzene increase will be immediately applied. I heard rumours that demand downstream was a little weaker here and there but for us derivative demand is running well”.
The producer confirmed that spot phenol prices also firmed on the back of higher feedstock costs and tight supply.
“Spot phenol prices have been firming, particularly in France were you can get a delta of €500-600/tonne over the benzene contract price," the producer said.
Spot phenol was valued at €1,216-1,316/tonne FD NWE, up €36/tonne.
European consumers also verified the €36/tonne increase for November phenol contracts.
“It [the phenol contract] is up with benzene. I don’t feel the market as tight,” one said.
A second major buyer for the adipic acid market said: “In terms of availability, for sure it’s better than last month. The French are running again and we are expecting to receive more [phenol] this month.”
The phenol contract is fully linked to a benzene formula, therefore supply and demand dynamics have no influence on the direction of the phenol contract price.
($1 = €0.70)
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