Europe September OX contract confirmed at €1,140/tonne

06 September 2012 17:44  [Source: ICIS news]

LONDON (ICIS)--The European September orthoxylene (OX) contract is fully confirmed at €1,140/tonne ($1,443/tonne) free delivered (FD) northwest Europe (NWE), an increase of €50/tonne from last month, sources said on Thursday.

Following an initial agreement heard on Wednesday, the number received further support from players in the market.

One producer said the settlement was in line with expectations. “I don’t think it’s a surprise, with the high gas and naphtha prices in the market now.”

A consumer said: “I can confirm a settlement at €1,140/tonne. With the development of the raw material prices and the tightness in the market, prices have gone up. I do expect the situation to relax in October, and maybe prices will decrease if suppliers are back online. I believe this tightness is short-term.”

However, another consumer said the trend is upward. “Prices will probably go up in October. If you look at the price in Asia, the feedstock costs in Europe and the tighter availability, the trend is going up.”

The buyer explained that crude oil price increases, coupled with limited volumes resulting from maintenance turnarounds at some European suppliers, are likely to keep OX prices firm next month.

“Demand is good, much better than it was at the same time in 2011,” the buyer added.

The OX market continues to see soft construction and automotive demand.

OX is largely used in the production of PA and is generally extracted by distillation from a mixed xylenes (MX) stream in a plant primarily designed for paraxylene (PX) production.

($1 = €0.79)

By: Helena Strathearn
+44 208 652 3214

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