03 January 2011 21:38 [Source: ICIS news]
MIBK price-hike initiatives ranged from 5-8 cents/lb ($110-176/tonne, €83-132/tonne).
A 40% surge in refinery grade propylene (RGP) spot prices in the past four weeks was cited as a major reason for the MIBK price push.
Propylene producers want to increase January contract prices by 14.50-15.00 cents/lb, following a 3 cent/lb gain in December. Propylene supply is constrained as one producer remained on 85% allocation after a disruption at one of its crackers.
Further upstream, NYMEX crude futures have been trending upward, hitting a 26-month high of $92.58 on 3 January.
MIBK would follow its feedstocks, one buyer said. Market participants anticipated little or no market volatility in the early part of the new year and continued slow market recovery.
However, a producer reported heavy buying in December ahead of potential hikes, which could weaken price momentum for January or at least prolong negotiations.
A buyer agreed, saying it was not sure the initiatives would be fully accepted. Sources said a broad settlement at plus 5 cents/lb was likely.
Despite several attempts to raise prices during second-half of 2010, US MIBK contract values remained stable, and were assessed by ICIS at 102-103 cents/lb.
US MIBK suppliers include Dow Chemical, Sasol, Eastman, Celanese and Haltermann.
($1 = €0.75)
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