14 February 2012 21:54 [Source: ICIS news]
HOUSTON (ICIS)--The jump in propylene last week made the 15 February increase for US butyl acetate (butac) a done deal and will most likely push prices up even more in March, buyers and sellers said on Tuesday.
That increase will raise the butac distributor price on Wednesday to 90-94 cents/lb ($1,984-2,072/tonne, €1,508-1,575/tonne), up from 85-89 cents/lb.
The hike pushes the contract price to 85-89 cents/lb, up from 80-84 cents/lb. Spot price reached 81-85 cents/lb from 81-82 cents/lb previously.
Another increase is likely in March, according to proposals issued by Oxea and Eastman Chemical. The hikes could raise butac by 10 cents/lb. Oxea also plans to raised feedstock n-butanol (NBA) by 15 cents/lb for 1 March.
Effective immediately, Oxea put butac, butanol and three other products on 100% sales control, based on the average monthly consumption over the past 6 months or as allowed by contract, the company said.
Oxea gave no explanation for its move. Eastman said the increase was because of increased market demand and operating costs, particularly in raw materials and energy.
Another buyer said Oxea’s March proposal would undoubtedly raise prices higher because of last week’s move in propylene. Propylene contracts for February rose by 16.50 cents/lb.
The 30% increase, driven by a surge in spot prices in January, put polymer-grade propylene (PGP) contracts in February at 72.50 cents/lb and chemical-grade propylene (CGP) at 71.00 cents/lb.
A producer said the rise in propylene was only part of the reason for the increases, that rising demand and tight supply also were factors.
Buyers said the move was driven only by the rise in feedstocks.
Major US butac producers include Dow Chemical, Eastman Chemical and Oxea Group.
($1 = €0.76)
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