02 August 2011 16:24 [Source: ICIS news]
LONDON (ICIS)--Abu Dhabi National Oil Company’s (Adnoc's) August official selling price for sulphur should be lowered to reflect weaker market conditions, traders said on Tuesday.
Adnoc has not revealed a likely direction for its monthly sulphur price – applicable to the Indian market only – as internal discussions continue.
“We will announce [the price] in the next few days and it will be in line with the current sulphur FOB [free on board] price,” a company source said.
Adnoc’s July price was set at $225/tonne (€158/tonne) FOB. The price was deemed unrealistic, given that the latest spot business in India netted back in the mid-$200s/tonne FOB under Fertilizer and Chemicals Travancore’s (FACT's) 21 June purchase tender.
“Even if Adnoc posts a $10/tonne decrease [to $215/tonne FOB], that still does not reflect the market,” a trader source said.
The sulphur market has been relatively weak in recent weeks because of slowing demand in major import markets.
With more traders agreeing to third-quarter contract prices with another major Middle East producer, Saudi Aramco, at $210/tonne FOB, there are expectations for Adnoc to follow suit.
“The price [$210/tonne FOB] has been talked at and psychologically accepted by both traders and buyers for some weeks now,” another trader added. "I think Adnoc will probably go for this level."
($1 = €0.70)
For more on sulphur, visit ICIS pricing fertilizers
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