26 October 2012 08:45 [Source: ICB]
Spot values of polycarbonate (PC) in Asia are likely to remain largely stable in the fourth quarter despite producers' attempts to implement price hikes because of ample supply and sluggish downstream demand, market sources said.
On 10 October, prices of general purpose (GP) extrusion-grade PC in Taiwan were assessed at $2,400-2,450/tonne (€1,848-1,887/tonne) CIF (cost, insurance and freight) Taiwan, while optical-grade PC was at $2,100-2,300/tonne.
Hong Kong (HK) spot PC prices for GP moulding-grade and optical-grade PC were at $2,500-2,600/tonne CIF HK and $2,250-2,350/tonne CIF HK, respectively.
Spot PC prices have fallen by an average of $275-300/tonne from their peak in May this year, according to ICIS.
"Prices will decrease because our demand is very weak," said a major buyer in the optical-grade PC sector in Chinese.
"Optical-grade PC demand would not improve in the next quarter as we have cut our operating rate considering poor downstream CD and DVD demand and pricing," another buyer said.
In October, producers attempted to increase prices by $30-50/tonne because of a thin spread between PC and feedstock bisphenol A (BPA), market sources said.
Based on the average spot BPA prices in September at around $1,710/tonne CFR (cost and freight) NE (northeast) Asia, the spread is at $500-850/tonne.
PC producers said spreads of $800/tonne and above are preferred, adding that further price declines will squeeze their already thin margins.
"[The] market will be quiet in the fourth quarter as [a] seasonal peak for Christmas holiday production is over," said a regional trader. "Despite firm offers by producers, opportunity for prices to rise is limited as real demand is very bad."
Another trader said: "The PC market is oversupplied across all three grades." Most players said growth in capacity has exceeded the increase in demand and raw material inflation will be the main driver of any price uptrend.
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