17 July 2012 23:59 [Source: ICIS news]
LONDON (ICIS)--European polyacetal (POM) third quarter contract prices have settled at a rollover from the second quarter, buyers and sellers said on Tuesday.
Weakening demand has been counterbalanced by rising feedstock costs across the second quarter and the need to preserve margins.
Demand from the automotive sector is slowing ahead of traditional summer holiday outages in August. Consumption is being further weakened by poor macroeconomic conditions, which have reduced consumer purchasing power.
“There’s a general malaise and lack of demand ... lots of people are resigned to wait for September,” a POM buyer said.
This has particularly affected the production of small- and mid-sized vehicles. Some players have estimated demand in July 2012 at up to 20% below July 2011 levels.
“Demand is definitely lower than last year, for July it’s 10-20% below 2011,” a POM buyer said.
Nevertheless, premium automotive production has not been affected by the general economic downturn, and is being supported by upward social mobility in Asia.
Third quarter POM contracts finalised at €2.20-2.30/kg ($2.70-2.84/kg) FD (free delivered) NWE (northwest Europe) for natural grade.
($1 = €0.81)
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