09 October 2012 23:08 [Source: ICIS news]
HOUSTON (ICIS)--An initial fourth-quarter settlement for US butanediol (BDO) was heard at a drop of 4 cents/lb ($88/tonne, €68/tonne), buyer sources said on Tuesday, but contract prices remained undefined this week.
Negotiations were expected to continue throughout the week, with final settlement expected for next week, sources said.
Producers were still pushing for a rollover, while buyers stood their ground for a 4 cent/lb drop.
One buyer said a large propylene decline has not been entirely reflected in successive BDO settlements, given current propylene prices and how they have changed from levels at the beginning of the year.
However, not all producers are affected by propylene behaviour.
Buyers pointed also to declining demand from downstream markets as one more reason to expect a lower fourth-quarter settlement.
“The Spandex market has been weak all year and the global economy woes are chipping at other sectors that have been less affected,” a buyer said.
Producers preferred to stress a tighter US BDO market that has no spare material as evidence that a rollover is more suitable for fourth-quarter contract settlements.
($1 = €0.77)
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