14 August 2012 06:35 [Source: ICIS news]
By Junie Lin
In the week ended 10 August, bulk MMA cargoes of more than 500 tonnes were assessed flat at $2,000-2,040 (€1,620-1,652/tonne) CFR (cost and freight) SE (southeast)
For iso-tank MMA cargoes of 20-300 tonnes, prices were also unchanged over the same period at $2,000-2,050/tonne CFR SE Asia, according to ICIS.
Until last week, MMA prices had been on a downtrend, shedding between $230-310/tonne or more than 10% from end-June, ICIS data showed.
Producers could no longer afford to bring down prices to protect their margins, which were significantly squeezed by the recent plunge in MMA prices and rising costs of feedstocks such as naphtha, acetone and methanol, market sources said.
Japanese producers face additional strain from the yen’s appreciation. A strong currency is a bane for exports as it effectively makes the products being shipped out more expensive and therefore, less competitive in the market.
Major Japanese producers said they will try to increase their prices for September because of rising feedstock costs. But most market players believe that the current MMA prices at $2,000-2,050/tonne CFR SE Asia may be rolled over for September cargoes.
“We will monitor the market for the time being and may settle for a rollover,” said a major Japanese producer.
MMA’s overall consumption in Asia was lower in August compared with July because of shorter working hours in some countries, particularly in the southeastern region, that observe the Muslim fasting month of Ramadan, which started on 20 July.
Even though end-users now enjoy better margins given a cost advantage from the recent falls in MMA prices, overall demand is unlikely to pick up significantly, market sources said. Consequently, no major fluctuations are expected on MMA prices.
Meanwhile, there were concerns about a possible influx of deep-sea MMA cargoes that could bloat
Shipping and selling enquiries of bulk deep-sea cargoes totalling more than 6,500 tonnes from Europe,
But no confirmed Asian buyers of the cargoes have emerged so far. Most end-users have very little requirement for bulk cargoes, given the current weak downstream conditions.
The sellers, however, may continue seeking export opportunities to Asia because of the summer holiday season and weak downstream demand in
($1 = €0.81)
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