FocusIndia, MidEast solvents to gain upon China's return to market

27 January 2012 05:08  [Source: ICIS news]

By Salinla Tulyasatien

SINGAPORE (ICIS)--Spot prices of solvents in India and the Middle East may increase, with buying activities likely to pick up once the Chinese market is back from its week-long holiday, industry sources said on Friday.

Acetone, ethylene acetate (etac), isopropanol (IPA) values are currently firm despite the strong availability of spot cargoes in the absence of the key China market, propped up by stable-to-firm values of feedstocks propylene and benzene, they said.

China is on holiday from 22-28 January.

In the week ending 25 January, acetone was assessed at $980-1,070/tonne (€745-813/tonne) CFR (cost and freight) India and at $980-1,020/tonne CFR Middle East, unchanged from the previous week, according to ICIS.

Spot prices of feedstock propylene were at $1,370-1,400/tonne CFR NE (northeast Asia) on Friday, while those of benzene stood at $1,180-1,190/tonne FOB (free on board) Korea, ICIS data showed.

Offers for acetone and IPA are likely to increase next week by about $20-40/tonne for February cargoes, market sources said.

“Selling ideas for acetone are at least at $1,000/tonne CFR India for a Singapore cargo for February shipment,” said a Singapore-based trader.

Players from across the Middle East share the same sentiment.

IPA spot prices were assessed at $1,200-1,250/tonne CFR India/CFR Middle East on 25 January, up $20/tonne from the previous week, according to ICIS.

“Anything less than $1,250/tonne CFR India would be impossible for February shipment,” said an IPA producer in South Korea.

Etac, on the other hand, was steady at $1,000-1,030/tonne CFR Middle East on 25 January, ICIS data showed.

Producers in India - a major etac supplier to the Middle East – are expected to raise their offers in view of the continued strengthening of the Indian rupee, market sources said.

The Indian rupee has strengthened by about 7% over the past six weeks against the US dollar at about Rs50 on Friday, according to currency data available at www.xe.com.

A strong currency translates to higher prices of products beoing shipped out.

“With the Indian rupee appreciating against the US dollar, it is not possible for selling etac less than $980/tonne FOB India,” said an Indian producer.

Trading activities are currently subdued since China and Taiwan are out of the market this whole week for the Lunar New Year festivity.

“I am expecting the price for acetone to range from $1,020-1,050/tonne CFR Middle East once the Chinese New Year is over,” said a Middle East trader.

Most buyers are not keen to procure cargoes at this time.

“I’m reluctant to make any purchase but rather wait for the Chinese market to return after the holidays to have a better idea,” said an India-based acetone buyer.

($1 = €0.76)

Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections

By: Salinla Tulyasatien
+65 6780 4359

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly