23 December 2011 10:24 [Source: ICIS news]
LONDON (ICIS)--An initial European cyclohexane (CX) Q1 delta contract has been agreed at €140/tonne, a reduction of €5/tonne from the fourth Quarter of 2011, the buyer and seller involved in the deal confirmed on Friday.
The fall was linked to a drop in raw material costs as well as weak demand for CX.
Consumption is weak throughout the downstream polyamide chain because of poor macroeconomic conditions and destocking.
Buyers are reducing inventories, not only to reduce working capital in year-end balance sheets – as is traditional – but also to increase cash flow to mitigate against the risk of a double-dip recession.
Views on CX demand in the first quarter are divided, with several players expecting a pick-up in consumption because of restocking and other players expecting buying interest to remain weak on negative general economic sentiment.
($1 = €0.77)
Additional reporting by Julia Meehan
For more on CX visit ICIS chemical intelligence
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