12 October 2012 23:59 [Source: ICIS news]
LONDON (ICIS)--European propylene oxide (PO) contract prices have fallen by €16/tonne ($21/tonne) in October on lower propylene feedstock costs, market players said on Friday.
PO formula-related prices in October have moved in line with 80% of the propylene reduction.
Freely negotiated PO business also followed the formula move in October on lower costs and fairly balanced market conditions.
The PO range in October has been changed to €1,546-1,662/tonne FD (free delivered) NWE (Northwest Europe), which reflects the €16/tonne reduction from September. Numbers down to €1,500/tonne FD were also heard from one buyer, but this was seen to be a net rather than gross value.
The PO market is largely balanced, as recent and forthcoming production constraints were being offset by reasonable-to-slower demand. depending on end-application.
PO consumption varies, depending on end-sector. The downstream food and flame retardants sectors remained fairly steady. Overall demand for downstream surfactants was stable, although there has been a shift in demand, depending on product type.
There has been talk of a shift away from more expensive branded surfactant products to more competitively priced white label products (not main brands) amid the soft macroeconomic conditions, according to some PO buyers.
Downstream polyurethane (PU) demand continued to hold up on the back of growth potential in eastern Europe and the legislative drive for thicker insulation to improve energy efficiency.
PO players, however, remained mindful that PO supply could be subject to a seasonal uptick in demand from the downstream de-icer and antifreeze sectors over the winter months, although this remains to be seen, according to most. One PO producer said it had seen its seasonal downstream demand gain momentum, but this was not widely confirmed.
In production news, BASF’s PO and downstream monopropylene glycol (MPG) operations at Ludwigshafen, in Germany were expected to undergo planned maintenance work at the end of October for around two weeks, as previously confirmed by a company source. There is no further update available at the time of going to writing.
($1 = €0.77)
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
Asian Chemical Connections