17 August 2012 20:33 [Source: ICIS news]
HOUSTON (ICIS)--US August cumene contract prices gained 1.8% from July, tracking record-high prices for feedstock benzene, sources said on Friday.
US August cumene contract prices were assessed by ICIS at 56-58 cents/lb ($1,235-1,279/tonne, €1,000-1,036/tonne) FOB (free on board).
July cumene contract prices were assessed by ICIS 1 cent/lb lower, at 55-57 cents/lb FOB.
The key driver for the increase was the movement of feedstock August benzene contracts, which gained 30 cents/gal to reach to a record high.
However, the surge in benzene was mitigated by the other key cumene feedstock, refinery-grade propylene (RGP).
Spot RGP prices were steady in July and August in the low- to mid-30s cents/lb range, capping cumene’s price movement.
The operating rates are low because export demand for downstream phenol, which has typically carried the highest margins, is very poor.
Supply of cumene is tight because of producers lowering operating rates to match the poor demand.
However, sources said that supply tightness is unlikely to affect prices, because operating rates could increase to match any unexpected shortfalls.
Major US cumene producers include CITGO, Flint Hills Resources, Georgia Gulf, Marathon, Shell Chemical and Sunoco.
($1 = €0.81)
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