06 March 2012 22:10 [Source: ICIS news]
HOUSTON (ICIS)--US domestic epoxy resin prices moved higher by 3% on increasing feedstock costs as March price-increase nominations took hold, sources said on Tuesday.
Previously assessed prices were at $1.50–1.60/tonne.
Sources said that price-increase nominations of 10 cents/lb from the major US producers were, for the most part, fully implemented after receiving a push-back in February.
“It looks as though it’s going to stick,” a buyer said. “The pricing won’t affect our business levels, but I can see it causing some demand destruction for others.”
Other buyers who had aggressively pushed back said they will find ways around the higher domestic prices.
“I’m not buying at that level,” one said. “This will force me to go to export material.”
Another buyer said that the price-increase nominations allowed for export material prices to move higher.
“Importers are keeping the gap between domestics and exports stable,” the buyer said. “However, there’s been no drop in demand, so it’s been mostly absorbed.”
Spot LER prices are assessed by ICIS at $1.45–1.55/lb, although several buyers reported that the gap is smaller, at a discount of 7–8 cents/lb.
LER producers argued that feedstock costs for bisphenol A (BPA) are increasing on the back of higher phenol and acetone costs. Also, LER feedstock epichlorohydrin (ECH) prices are being pushed by higher propylene.
“The bottom line is, we’re still well below where we need to be,” a producer said. “There are still feedstock costs that need to be passed along.”
Sources said there are several price-increase nominations for mid-March and early April in the range of 10–12 cents/lb, but buyers are expected to push back more strongly.
Major US LER producers include Dow Chemical, Huntsman and Momentive.
($1 = €0.76)
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