25 May 2012 20:34 [Source: ICIS news]
The range of spot prices last week – $1,600-1,750/tonne – surprised some market sources and this week’s range – $1,465-1,700/tonne – an average dip of 5.5%, surprised some as well.
Asian spot prices are $1,750-1,800/tonne CFR (cost and freight) to NE Asia, while European spot prices are $1,750-1,900/tonne CIF (cost, insurance and freight).
Since the start of the year, ACN spot prices have moved from an average of $1,725/tonne to a high of $2,205.50/tonne in mid-March to the current average of $1,582.50/tonne, a 8.3% drop since the early January spot price average.
Spot prices have fallen as downstream demand has lessened and because buyers are waiting for lower prices with the projected drop in propylene costs.
Some producers have reduced production rates to avoid too much exposure at these reduced spot prices, but they have maintained enough production to meet contractual obligations.
One producer said it does not want to contribute to the further erosion of prices, and that production rates will increase once it becomes profitable again.
By this point in the month, most, if not all, producers have already produced the material needed to meet contractual obligations.
Another market source said activity in the ACN market is so lacklustre that it had not heard of any bids in the past week.
North American ACN producers include Ascend Performance Materials, Cornerstone Chemical, INEOS Nitriles and Unigel.
($1 = €0.80)
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