US Q2 VAM settles down by 5 cents/lb on feedstock ethylene drop

09 July 2012 18:14  [Source: ICIS news]

HOUSTON (ICIS)--Second-quarter contracts for US vinyl acetate monomer (VAM) dropped 5 cents/lb ($110/tonne, €90/tonne) following the feedstock June ethylene settlement, sources said on Monday.

The reduction puts US VAM contracts at 54-57 cents/lb, down from 59-62 cents/lb in the first quarter of 2012, as assessed by ICIS.

US ethylene is a major VAM feedstock. The US June ethylene contract settled last week at 39 cents/lb, down 7.25 cents/lb from May on lower spot prices and reduced production costs last month, according to market sources.

The VAM reduction followed a 24% drop in ethylene spot prices in June, stemming from ethane prices plunging to a 10-year low on pressure from ample supply.

The ethylene drop pushed VAM spot prices down also, with free on board (FOB) export prices falling $100/tonne last week to $750-850/tonne from $850-950/tonne in the fourth spot drop in the past month.

Major US VAM sellers include Celanese, Dow Chemical, DuPont and LyondellBasell

($1 = €0.82)

By: Lane Kelley
+1 713 525 2653

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