US Q1 detergent alcohol falls 20 cents/lb on lower feedstock

19 January 2012 15:59  [Source: ICIS news]

HOUSTON (ICIS)--First-quarter US detergent alcohol contracts settled down from the fourth quarter, primarily driven by lower feedstock palm kernel oil (PKO) prices, buyers and sellers said on Thursday.

First-quarter contact business for natural and synthetic detergent-range alcohols in the C12-15 group was assessed at 105-120 cents/lb ($2,315-2,646/tonne, €1,806-2,064/tonne), dropping 20 cents/lb from the fourth-quarter. 

The main driver for the declines was the low-priced feedstock PKO that formed the basis for alcohols produced and ready for use for the first quarter of 2012.

PKO prices fluctuated mostly down during the second half of 2011, falling from a high mark of about a dollar early in the year to a low of about 53 cents/lb in October for refined PKO, buyers said.

Since fatty alcohol supply into the US is largely import-based, there is at least a 30-day lag-time between the Asian PKO prices and the finished alcohols arriving at US tanks.

Suppliers said the squeeze in the PKO prices pushed offers significantly lower for first-quarter contract negotiations, while buyers’ input underpinned the depth of the cuts.

“Prices are cheap right now and nobody is making profit,” one importer said.

“The US market doesn’t look that attractive for imports at this time,” the source added.

Procter & Gamble and Cognis are domestic natural fatty alcohol producers, while Shell is the only US synthetic alcohol producer.

VVF, Musim Mas, Ecogreen and Kao are among the alcohol importers to the US, all PKO feedstock-based.

Detergent alcohol end-uses include household and industrial surfactants and other cleaning aids.   

($1 = €0.78)

By: Judith Taylor
+1 713 525 2653

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