08 December 2011 07:55 [Source: ICIS news]
SINGAPORE (ICIS)--Crude glycerine prices in China have fallen for a second straight week, losing $50-70/tonne (€38-53/tonne) in a fortnight because of weak demand and producers’ inventory pressure, market players said on Thursday.
Crude glycerine prices were assessed at $290-310/tonne CIF (cost, insurance & freight) China Main Port (CMP) in the week ended 7 December, as compared with $340-380/tonne CIF CMP in the week ended 23 November, ICIS data showed.
Prices declined in line with sporadic deals that were done after weeks of standoff between buyers and sellers.
Producers have relented and lowered their offers because of their rising inventory pressure as well as the persistently weak demand, market players said.
Demand has remained low because the weak macroeconomic conditions in China as well as recent credit tightening measures have affected the country’s construction industry, which is a major downstream sector of crude glycerine.
Crude glycerine prices were also weighed down by falling refined glycerine prices in China, according to the players.
Refined glycerine in China is mostly used to manufacture alkyd resins, which are used in paints.
As a result, offers fell from $370-380/tonne CIF CMP in late November to below $330/tonne CIF CMP in the week ended 7 December, against bids that were maintained at below $300/tonne CIF CMP, according to ICIS data.
“I expect more activity in the market in the coming weeks as buyers are now in the process of discerning if prices have bottomed out,” said a major glycerine trader.
($1 = €0.75)
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