05 November 2012 10:35 [Source: ICIS news]
LONDON (ICIS)--European naphtha solvent prices have softened by $80/tonne (€62/tonne) to $1,030-1,050/tonne FOB (free-on-board) Rotterdam, as a result of lower naphtha and gasoline prices, sources said late on Friday.
However, some market participants said prices should be lower, but they have not seen the softer feedstock prices trickle into the market yet.
“The market is in a quiet period prices should be going down further,” a distributor said.
“People are sitting on the fence when it comes to buying, and they are unwilling to commit too far ahead.”
However, another source said some producers have decided to roll over prices or decrease them only slightly, as lower prices will not stimulate demand.
The source said that producers with market share would opt to keep prices stable and maintain margin.
Demand is understood to be quiet, and low levels of interest are being expressed in the UK, which some participants put down to the mid-term holiday.
Prices in the UK have eased to 70-71 pence/litre FD (free delivered), a decrease of 3 pence/litre compared with last week.
A source said there could be scope for a mid-month price change in the UK depending on feedstocks and shifting exchange rates.
European gasoline prices have softened by around $200/tonne since 1 October. Gasoline is the benchmark many producers use for naphtha solvent pricing.
Naphtha prices have also softened, down by $34/tonne since 1 October, with the European market currently considered tight. However oversupply is expected to build in the middle of the month as refineries resume activity after the maintenance season.
($1 = €0.78)
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