11 July 2012 23:59 [Source: ICIS news]
LONDON (ICIS)--European July ethanolamines contract prices have fallen because of the €170/tonne drop in ethylene, slowing demand, ample availability and competitively priced imports, market sources said on Wednesday.
Following a similar pattern to previous months, the largest fall has been for monoethanolamine (MEA) which settled in a €1,280-1,370/tonne ($1,561-1,671/tonne) range.
The contracts were agreed on a free delivered (FD) northwest Europe basis.
While decreases were widely confirmed, some producers were adamant that they did not want give all of the ethylene price decrease away.
“If customers don’t expect price increases when feedstock costs are going up, why should they expect decreases when feedstock prices are coming down,” said a European producer.
However, the producer confirmed that the European market had come under pressure from competitively priced imports.
“Importers have been using raw material advantages and there were lots of cheap material from Mexico, Brazil, the US, Thailand and Taiwan. Compare this with Europe we could not follow and this was the case until May,” the producer concluded.
Another said it has decreased its price by €20-30/tonne adding that its demand was “not too bad at all”.
In relation to this, one trader said: “I think this price decrease is the first step and my feeling is prices will be lower in the second half of July.”
Comparing current demand with July last year, the trader added that it was most definitely slower.
A second trader said: “The market lacks any visibility and I don’t expect to see much happening during the summer.”
($1 = €0.82)
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