13 July 2012 23:59 [Source: ICIS news]
LONDON (ICIS)--Export prices in the European caustic soda market have increased on limited availability, driven by low co-product chlorine production, market sources said on Friday.
According to industry body Euro Chlor, average European daily chlorine production in June decreased by 5.2% from May, while inventories of co-product caustic soda decreased by 7.2% in the same period.
In the Mediterranean, prices have increased by $50/dmt (€41/dmt) to $420-440/dmt FOB (free on board) Med (?xml:namespace>
Middle Eastern suppliers are said to be concentrating on the south Asian markets, where supply remains tight and prices more attractive than in the net-importing markets of Italy and Turkey.
A deal was confirmed at $440/dmt FOB Med to Turkey this week, with an estimated freight cost of $70/dmt. There was no confirmation from the customer, but buyers’ price ideas were at around $420/dmt FOB.
According to a buyer, some suppliers in the Mediterranean will be out of product until the end of August.
In northwest Europe, prices increased by $20/dmt to $380-400/dmt FOB NWE (northwest Europe), based on bullish sentiment and price ideas from sellers and buyers.
Offers to the Mediterranean were heard at $400-420/dmt FOB, with an estimated freight cost of $100-110/dmt, while bids were heard at $380-390/dmt FOB.
Producers have received a substantial number of enquiries for delivery in the Mediterranean, where prices have seen a remarkable increase since the beginning of July and are now more attractive than in the US east coast.
The outlook for the rest of the third quarter points to further tightness, as demand for chlorine derivatives tends to slow down throughout the peak of the European holiday season.
($1 = €0.82)
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