US March acrylates begin to settle at 10-12 cent/lb hikes

13 March 2012 22:42  [Source: ICIS news]

HOUSTON (ICIS)--US acrylic acid and acrylate esters contracts for March were beginning to settle within the higher range nominated by two of the three major domestic producers, sources confirmed on Tuesday.

A buyer reported an early contract settlement at an increase of 10-11 cents/lb ($220-243/tonne, €167-185/tonne). Another reported settlements at nominated increases of 10-12 cents/lb, taking 12 cents/lb on glacial acrylic acid (GAA) and methyl acrylate (methyl-A), and 10 cents/lb on 2-ethylhexyl acrylate (2-EHA).

No settlements were heard at plus 13-14 cents/lb, which was the high end of a range proposed by a third producer. That effort surfaced in February but appeared to have been delayed until March, sources said.

However, a market consensus on March acrylates gains remained elusive.

The current glacial acrylic acid (GAA) contract range is $1.12-1.17/lb, as assessed by ICIS.

Most buyers see current conditions as soft, with available supply likely to expand further until buying for the spring coatings season begins to gain momentum.

The March acrylates initiatives stemmed from a 16.5 cent/lb increase in February feedstock chemical-grade propylene (CGP).

But the feedstock rationale is small comfort to buyers.

“My management team was upset because, of course, we can’t pass along all of the inflation,” a buyer said of the March initiatives.

But the rate of upstream cost increases did slow as propylene contracts for March settled up by 5 cents/lb, rising by 7% from February versus 30% from January to February.

($1 = €0.76)

By: Larry Terry
1 713 525 2653

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