17 May 2012 16:35 [Source: ICIS news]
LONDON (ICIS)--European acetone spot prices continue to move down as the market eyes falling crude and feedstocks costs, sources said on Thursday.
“With [Brent] crude breaking the $110/bbl mark nobody will be buying anything they don’t need now,” said one market follower.
Another said: “There is no demand and everybody knows that next price will be lower, so they are holding off until the need it.”
Prices quoted across the European market so far this week are down by approximately 14% compared with levels recorded four weeks ago when spot acetone was trading at €1,100-1,160/tonne ($1,392-1,468/tonne) FD (free delivered) NWE (northwest Europe).
One acetone trader described the spot market as “crashing like a stone”.
“Nobody will buy [acetone] today. Everybody is waiting and this adds to the downward pressure. Demand is simply dull, in fact it’s more than dull,” the trader added.
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Nonetheless, the rate at which spot prices are falling is causing concern since some traders are thought to be sitting on volume which they paid four-figure sums for.
“Some sellers are being very aggressive and it’s all pointing to the south. My lowest price this week is €960/tonne on a free delivered basis,” said an ARA (
Another ARA trader said its prices deviated depending on location.
A buyer was looking to secure 10-15 trucks of acetone and was driving prices down to €940/tonne FD, according to one market source.
“Traders are getting nervous and they need to move stock to avoid losing money. They’re riding the wave of the storm and selling short,” said the German based trader.
Meanwhile, producers of acetone were not so bearish about pricing or demand.
“Okay, so the market is a little uncertain but look at the facts and the figures. Nothing has changed. Looking at the situation today we are still tight and demand is still good. People are asking for more material across all the portfolios - MMA [methyl methacrylate], BPA [bisphenol A] and solvents,” said one major producer.
Another said it expected to be tight until the second half of June, when it would be returning to the spot market.
($1 = €0.79)
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