US Q1 glycerine contracts pressured up on supply/demand

08 December 2011 00:24  [Source: ICIS news]

HOUSTON (ICIS)--US first-quarter refined glycerine contract prices will likely increase on supply-demand factors and rising price ideas from Asian importers, buyers and sellers said on Wednesday.

“Personal care, cosmetics and tobacco want the non-GMO [non-genetically modified] glycerine,” a major supplier said. “That means no soybean-derived glycerine, and that means rising prices."

The US is a net-importer of glycerine. Most of the non-GMO kosher quality product is brought in from Asia.

While no formal increase announcements have surfaced – a trend that has dominated in the US glycerine market for about 24 months – several suppliers confirmed that they are negotiating contracts for the first quarter and achieving higher prices.

Vegetable-based glycerine contracts ranged between 38–46 cents/lb ($838–1,014/tonne, €628–761/tonne) in the fourth quarter, with tallow-derived glycerine contracts assessed at 36–44 cents/lb.

Sources were discussing price increases of 2–3 cents/lb in both tiers. First-quarter contract negotiations began following the US Thanksgiving holiday, and are likely to continue past year-end.

US glycerine producers and refiners include Procter & Gamble, Vantage Oleochemical, Emery Oleochemicals and VVF. Cargill is an agriculture-based producer.
ADM said it would no longer offer USP-grade glycerine contracts beginning January in order to concentrate the material in production of its "green" propylene glycol (PG).

($1 = €0.75)

By: Judith Taylor
+1 713 525 2653

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