04 June 2012 16:05 [Source: ICIS news]
HOUSTON (ICIS)--US June cumene contracts are expected to fall by 11% from May levels because of weaker feedstock costs, sources said on Monday.
Buyers and sellers are anticipating that June cumene contract prices will be 55-57 cents/lb ($1,213-1,257/tonne, €982-1,018/tonne) on an FOB (free on board) basis.
This would be down by 7 cents/lb from May’s settlement of 62-64 cents/lb FOB.
The bigger cumene feedstock, US benzene, also experienced a recent fall, with the June contract price dipping by 10 cents/gal.
However, the contract was expected to settle at a bigger drop earlier in May based on spot price weakness, but a rebound late in May limited the fall.
Premiums for cumene over feedstock costs are expected to remain steady, as the supply-demand balance is stable.
If demand continues to be softer than normal, however, operating rates at US cumene plants could be lowered.
Major US cumene producers include CITGO, Flint Hills Resources, Georgia Gulf, Marathon, Shell Chemical and Sunoco.
($1 = €0.81)
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