31 January 2012 10:36 [Source: ICIS news]
LONDON (ICIS)--European aromatics players are braced for another triple-digit increase for the February benzene contract, as limited pyrolysis gas (pygas) availability, buoyant crude values and firm numbers in the US and Asia maintained upward pressure on the market, sources said on Tuesday.
After trading as high as $1,310/tonne (€996/tonne) CIF (cost, insurance, freight) ARA (Amsterdam, Rotterdam, Antwerp) last week, February benzene lost a bit of steam as the week drew to a close, with deals at $1,270/tonne.
“Crude numbers started to come off, and there was the feeling that the market had peaked with the $1,310/tonne deal,” explained one trader.
However, February opened this week slightly firmer, and there were several deals at $1,280/tonne.
A number of sources expect that the February contract will be agreed somewhere between these two numbers.
The monthly benzene contract for January was agreed at $1,108–1,115/tonne FOB (free on board) NWE (northwest Europe), the first time in several years that a range has been widely confirmed in the market.
With the February ethylene contract settling up €99/tonne, many are expecting a similar increase on the monthly styrene barge contract, which has left many downstream players concerned about how this will be received by consumers that already struggled with the €120/tonne increase for January.
There was a slow start to January for many in the polystyrene (PS) and expandable polystyrene (EPS) business, alongside some seasonal dip in consumption, and suppliers were unable to fully pass on the January styrene hike to their customers.
($1 = €0.76)
For more on benzene and styrene visit ICIS chemical intelligence
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