25 July 2012 21:38 [Source: ICIS news]
HOUSTON (ICIS)--The US July barge acetone contract reached a full settlement at an increase of 1.1% from June levels, sources said on Wednesday.
The US July barge acetone contract settled at 45 cents/lb ($992/tonne, €823/tonne) DEL barges (delivered via barges), up from June’s settlement of 44.5 cents/lb.
However, spot RGP prices have fallen by just 4.7% in the past four weeks, as assessed by ICIS.
“That shows that the market is focusing on supply-demand fundamentals,” a producer said. “Supply is snugging up.”
Acetone supply remains tight because operating rates are low, mostly because export demand for co-product phenol is weak.
With phenol-acetone feedstock US benzene prices also surging, acetone producers said they cannot justify producing additional material to meet market demand.
Buyers and sellers said demand of acetone for methyl methacrylate (MMA) production remains healthy, although it has slipped in recent weeks.
“We’re starting to think June was the bottom,” a source said. “July has been flat and August should start the rebound.”
The US barge acetone contract is negotiated between three large producers - Georgia Gulf, INEOS Phenol and Shell Chemical - and the three largest buyers -- Dow Chemical, Evonik and Lucite.
($1 = €0.83)
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