16 January 2012 12:51 [Source: ICIS news]
LONDON (ICIS)--The European January orthoxylene (OX) contract has settled at €960/tonne ($1,215/tonne) – a rise of €40/tonne from the previous month, two producers and two consumers confirmed on Monday.
The settlement was agreed on a free delivered (FD) northwest Europe (NWE) basis.
Buyers and sellers said the increase is being attributed to the euro-dollar exchange rate, as well as pricing trends in the US and Asia and current market conditions.
“The price went up based on the euro exchange rate and energy costs,” a producer said.
A buyer said that in addition to the above reasons, prices had increased because producers want to reclaim some margin. The buyer also said: “January demand has been fine, not a very good month, but better than December.”
A lack of transparency prevails in the OX spot market. However, prices are firming on export demand, with traders notionally assessing values at $1,330–1,400/tonne FOB (free on board) Rotterdam.
Despite weak domestic consumption because of poor macroeconomic conditions, derivative phthalic anhydride (PA) demand is also firmer than in December because of restocking. Additionally, exporters say overseas buying interest for European material is growing, and exports to the Middle East, Asia and Africa have increased sharply in January.
The European January paraxylene (PX) contract was fully confirmed last week at €1,130/tonne FD NWE, an €80/tonne increase from the December contract price.
OX is largely used in the production of PA, and is generally extracted by distillation from a mixed xylenes (MX) stream in a plant primarily designed for PX production.
($1 = €0.79)
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