23 February 2012 18:34 [Source: ICIS news]
HOUSTON (ICIS)--A US butadiene (BD) producer has nominated a price increase of 27% for its March contract, sources confirmed on Thursday.
The 32 cent/lb ($705/tonne, €536/tonne) price-increase nomination would move the producer’s March contract price to $1.50/lb.
The producer settled its February contract price at $1.18/lb, in line with two other producers.
The fourth US BD producer settled at $1.30/lb and nominated a March contract price of $1.55/lb.
The February BD contract was split, with about 85% of the market settling at the lower contract price.
BD prices are expected to increase on the back of tight supply because of cracker outages and planned turnarounds in the first and second quarters.
Domestic demand is stable at healthy levels, but demand in Asia is also strong, lending support to the recent BD contract nominations.
Several BD buyers cautioned that prices are moving into a range that will cause demand destruction, especially in the key styrene butadiene rubber (SBR) market.
Major US BD producers include ExxonMobil, LyondellBasell, Shell and TPC Group. Buyers include Ashland, Invista, LANXESS, Michelin and Negromex.
($1 = €0.76)
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