29 November 2011 08:03 [Source: ICIS news]
By Trisha Huang
MELBOURNE (ICIS)--Spot methyl isobutyl ketone (MIBK) prices in China fell for a seventh week and may continue to decline amid growing supply and weaker values of feedstock acetone, market sources said on Tuesday.
Deep-sea MIBK cargoes for January 2012 delivery will increase the availability of the material in ?xml:namespace>
Offers for spot MIBK have declined to $1,700/tonne (€1,275/tonne) CFR (cost and freight)
MIBK’s fall has lagged behind that of feedstock acetone. Average spot acetone prices have plunged by almost 24% since early October to $890/tonne CFR China for the week ended 25 November, ICIS data showed.
In addition to the acetone price slide, MIBK prices may be under further downward pressure as producers typically try to clear inventory towards the end of the year, market sources said.
Regional MIBK supply has been restored after
Despite the acetone price slide, Japanese MIBK producers’ selling ideas were still at $1,800-1,810/tonne CFR China for December shipment.
Meanwhile, a trader is offering a Japanese cargo at $1,700/tonne CFR China for second-half December shipment, but prevailing bids were at $1,600/tonne CFR China for December.
“Domestic prices in
“That’s equivalent to $1,650/tonne CFR for imports, so it’s understandable that buyers would be bidding at an even lower level because [acetone and MIBK] prices have been falling so fast,” he said.
Domestic MIBK prices in east
A Chinese importer said it declined the $1,700/tonne CFR China offer on concern that there may be considerable difficulty in selling the product, as demand tends to fall before the Lunar New Year holiday period.
The Lunar New Year will start on 23 January in 2012.
“The cargo will arrive at the end of December and it will be difficult to move product in the lead up to the [Lunar] New Year period,” said the importer who declined the offer.
“I would not consider buying MIBK even at $1,600/tonne CFR China today,” he added.
Operating rates at many factories and plants are expected to decrease ahead of the week-long holiday in
MIBK is used mainly as a solvent for industrial paints and thinners and in the production of rubber chemicals.
($1 = €0.75 / $1 = CNY6.39)
Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections
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