28 April 2011 23:59 [Source: ICIS news]
LONDON (ICIS)--European propylene oxide (PO) contract prices have increased by €20-25/tonne ($29-37/tonne) in April, driven by rising upstream costs, market players said on Thursday.
In order to reflect this, the European PO price range was increased to €1,630-1,735/tonne FD (free delivered) NWE (northwest Europe), according to ICIS.
Formula-related PO accounts have moved up by at least €20/tonne in April, in line with higher propylene costs, although there are also crude surcharges of €5-10/tonne, which have also been applicable in some cases. There was sufficient market confirmation to substantiate the plus €5/tonne above the formula move.
Other drivers for the larger-than-formula increase included healthy demand and balanced-to-tight supply.
Looking to May, prices are also set to rise again, by at least €28/tonne, in line with the higher propylene settlement.
There is an ongoing momentum in most downstream sectors such as automotive, construction and surfactants. By contrast, downstream glycols activity and pricing remain disappointing, according to one manufacturer, who said that due to some PO supply restrictions, there would be a prioritisation of PO into better performing derivatives.
Supply is balanced-to-tight, depending on source. Sellers said that availability was sufficient, albeit restricted in some cases, due to plant outages in Europe and outside the region. Customers, however, contest this view, stating that supply is adequate, despite forthcoming plant outages for two main players in May.
In production news, INEOS Oxide’s PO and downstream mono propylene glycol (MPG) operations at Cologne in Germany are expected to undergo a planned maintenance stop in May, to last for approximately three to four weeks. The site has a nameplate capacity of 210,000 tonnes/year for PO and 135,000 tonnes/year for MPG, according to ICIS plants and projects.
Dow Chemical’s PO and MPG facilities at Stade, in Germany are due to shut down for a major maintenance turnaround at the end of April/early May. The outage is expected to last for approximately four to five weeks. The nameplate capacities at Stade are rated at 590,000 tonnes/year for PO and 270,000 tonnes/year for MPG, according to ICIS plants and projects.
($1 = €0.68)
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|
Asian Chemical Connections