Europe July TDI contracts roll over

11 July 2012 23:59  [Source: ICIS news]

LONDON (ICIS)--The majority of European toluene di-isocyanate (TDI) contract prices have rolled over into July as slowing downstream demand is being offset by some production constraints, market players said on Wednesday.

European TDI contract prices remain steady in July at €2,180-2,300/tonne ($2,659-2,805/tonne) FD (free delivered) NWE (northwest Europe).

Some price increases for TDI in July were reported by sellers, although some suppliers also acknowledged that any increases were on a selective basis rather than representative of a general market trend.

By contrast, one producer said it had implemented average increases of €20/tonne for TDI in July, although it said it also had a mix of rollover and larger increases, depending on starting point and volume size.

One customer said it had heard about some higher prices, but considered this was for spot rather than contract volumes.

Some downward price adjustments were also heard for TDI contract business in July.

One customer said it agreed a price reduction of €50/tonne for July, taking its price to €2,250/tonne FD NWE. However, this was not widely confirmed in the market.

Other buying and selling sources confirmed prices up to €2,300/tonne FD as still valid in July.

In fact, some sellers said they had secured prices at the upper end of the range €2,250-2,300/tonne FD if not slightly above in July, but the latter was seen to be for limited volumes and not representative of the general trend.

Numbers as low as €2,100/tonne FD NWE were reported in a few cases, but they were not widely confirmed.

The market is balanced to snug on the back of some production constraints and some ongoing attractive export opportunities to certain countries such as parts of Africa and South America.

TDI consumption is seasonally slowing in parts of Europe because of the plant shutdowns during the summer holidays.

On top of this, there is the underlying economic uncertainty, which is also limiting activity in parts of Europe, especially in the Mediterranean, which has been most affected by the economic crisis.

Demand in central Europe, Russia and Turkey, however, continue to hold up reasonably well, because of some underlying growth potential there, in contrast to the more mature northwest and southern European markets.

In manufacturing news, Bayer MaterialScience’s force majeure remains in place on its isocyanates supplies in Europe and the Middle East and Africa. This came into effect in mid-June, following some disrupted production at its Brunsbuettel site in Germany, which resulted from upstream supply constraints from its third party supplier.

Ciech subsidiary Zachem’s TDI facility at Bydgoszcz in Poland is expected to restart by the end of this week, following planned maintenance work. The unit went off line on 20 June and the turnaround was expected to last for around 2.5 weeks.

BorsodChem’s TDI operations at Kazincbarcika in Hungary are due to enter into planned maintenance over the weekend of 21-22 July, which is likely to last for 3 weeks, with the ramp-up process taking place after this.

There was no further update available on the status of BASF’s TDI facility at Schwarzheide in Germany, which has experienced some technical constraints over recent weeks.

($1 = €0.82)


By: Heidi Finch
+44 20 8652 3214



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