31 May 2011 23:37 [Source: ICIS news]
HOUSTON (ICIS)--US acetic acid free on board (FOB) export prices have fallen $55/tonne in the past week on growth in inventories, buyer sources said on Tuesday.
The drop came less than a month after BP declared force majeure (FM) on acetic acid in early May because of problems from a power outage at a plant in Texas City, Texas.
The buyers said they had not heard if BP had ended the FM.
Buyers said the FOB export price for acetic acid had fallen to $615-635/tonne (€431-445/tonne), from the previous $660-700/tonne.
One buyer said it heard that acetic acid suppliers had stockpiled too much material. The buyer was negotiating for a contract reduction based on the drop in the spot price but had not yet reached an agreement.
BP markets all of the acetic acid produced by a 545,000 tonne/year Sterling Chemicals plant in Texas City, in a deal that expires in 2031, according to Sterling’s website.
The power outage disrupted operations at the Sterling plant, sources said.
Prices for FOB export US acetic acid rose $60/tonne on the low end when the FM was announced.
Acetic acid is primarily used to make vinyl acetate monomer (VAM).
BP and Sterling Chemicals did not respond to calls seeking comment on details about the FM .
($1 = €0.70)
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