Asia C16-18 alcohols to stay firm on tight supply, feedstock costs

29 April 2011 04:54  [Source: ICIS news]

SINGAPORE (ICIS)--The prices of Asian long-chain alcohols in May are likely to remain firm on the back of tight supply and firmer feedstock costs, traders said on Friday.

According to ICIS data, the prices of long-chain C16-18 alcohols rose to $2,050-2,200/tonne (€1,374-1,474/tonne) FOB (free on board) SE (southeast) Asia on 27 April, up by 2.5-7.3% or $50-150/tonne from a month ago.

Market players said supply shortages and rising feedstock crude palm kernel oil (CPKO) and crude coconut oil (CNO) costs were the main reasons that prices had increased.

On 27 April, the prices of CPKO had risen by $9/tonne to $1,809/tonne FOB Malaysia month on month, industry sources said, while CNO prices had risen by $190/tonne to $2,140/tonne CIF (cost, insurance & freight) Rotterdam from a month ago, according to the Asian and Pacific Coconut Community (APCC).

“Most producers in Malaysia and Indonesia had no prompt cargoes. Market supply is tight,” a Chinese buyer said.

“Although some Philippine producers may have cargoes, prices are much higher due to the high CNO price,” a Singapore-based trader added.

“Feedstocks costs had gone up, CPKO is high, ringgit is strong,” a Malaysian producer said.

Prices in May are expected to remain firm as the weak US dollar is exerting upward pricing pressures on feedstock costs, buyers said.

“I believe prices will remain firm in May, feedstock prices are high, producers may be fractionating less of this alcohol, so supply will remain tight,” a South Korean buyer added.

($1 = €0.67)

By: Serena Seng

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