FocusPoor sales may keep Asia PMMA on downtrend in July

15 June 2012 09:47  [Source: ICIS news]

By Junie Lin

GP PMMA has applications in car tail lightsBRISBANE (ICIS)--Spot prices of general purpose (GP) polymethyl methacrylate (PMMA) in Asia may continue to head south in July after sales slumped in June as most buyers are keeping out of the market, industry sources said on Friday.

June has been the worst month for PMMA sales in the first half of the year, according to regional producers.

In the week ended 14 June, GP PMMA prices were assessed at $2,350-2,450/tonne  (€1,880-1,960/tonne) CFR (cost and freight) China, down by $100/tonne at the low end of range from the previous week, according to ICIS.

PMMA consumption typically peaks at this time through the third quarter as production ramps up, in anticipation of the Christmas season - when exports of Asian-made goods normally spike.

But many end-users in China have received fewer export orders amid a weakening global economy – with the eurozone still battling a debt crisis, the US economy still in a fragile state and the Chinese economy slowing down.

Some PMMA producers said they are now mulling cutting production because of poor demand.

MMA is polymerised to make homopolymers and copolymers with the largest application being the casting, moulding or extrusion of polymethyl methacrylate (PMMA) or modified polymers.

GP PMMA goes into making of household products such as cosmetics bottles, and its automotive applications include car tail lights and speedometer covers.

Sellers said downstream buyers are understandably cautious, in view of the broader petrochemical market downturn.

“Most buyers are buying in smaller quantities to guard against macroeconomic risks,” one Chinese domestic producer said.

“Other buyers are still saddled with inventories of PMMA or finished products because of poor export sales, and were not keen to purchase PMMA despite the falling prices,” he added.

There were initial hopes at the start of June that high prices of feedstock methyl methacrylate (MMA) could support PMMA values, but oversupply and weak demand weighed heavily on the market. Even MMA prices have come off.

In China, domestic MMA prices have fallen by more than yuan (CNY) 1,000/tonne ($157/tonne) since early June.

Chinese domestic GP PMMA prices plunged CNY600-700/tonne week on week at CNY17,600-18,500/tonne DEL (delivered) on lower buy-sell discussions levels in the week ended 14 June, ICIS data showed

Deals were concluded this week at CNY17,600-17,800/tonne DEL from a local major producer. A Chinese producer has selectively lowered its GP PMMA prices and is currently offering the material at around CNY17,800/tonne to the low CNY18,000/tonne DEL levels.

Other discussions of Japanese and South Korean product were at close to CNY18,000/tonne DEL, market sources said.

“Even small parcels can fetch no more than CNY18,500/tonne DEL now,” said a northeast Asian producer.

($1 = €0.79 / $1 = CNY6.37)

Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections


By: Junie Lin



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