16 November 2012 09:29 [Source: ICB]
European toluene di-isocyanate (TDI) contract prices generally moved up by €10-30/tonne ($13-38/tonne) in November, depending on starting point, on a bullish producer stance amid high feedstock costs and a balanced-to-snug market, according to market players.
European TDI contract prices were assessed in November at €2,240-2,280/tonne FD (free delivered) NWE (northwest Europe), according to ICIS. This represented an increase of €30/tonne at the low end and a rise of €10/tonne at the upper part of the range.
News of the reduction in upstream toluene contracts in November did little to dampen the bullish TDI producer stance because it came too late to impact TDI contract price discussions in most cases.
Also, sellers maintained that toluene feedstock costs remain high despite the relief in November and they had still not recouped the previous increases over the last few months. Larger hikes of up to €50/tonne were reported by a few sellers but they were not widely confirmed. There were also rollovers in some cases but they were not seen to reflect the general market trend.
Numbers down to €2,200/tonne FD and up to €2,350/tonne FD were also heard in November, but there was insufficient market confirmation to substantiate this level. Demand into the downstream bedding and furniture sectors in northwest Europe remains reasonable, although some buyers maintain that it is below seasonal expectations for the time of year.
Traditionally, bedding and furniture activity should be seasonally healthy in the autumn, but this has been dampened to some extent by ongoing economic uncertainty and resulting reduced consumer spending.
In eastern Europe, Russia, the Middle East and Africa, demand continues to hold up well, supported by underlying growth potential in the emerging markets in contrast to the more mature northwest European market.
TDI material is not readily available, because of good export opportunities and talk of some possible production constraints for a few suppliers over the last few weeks. Buyers, however, maintain that they have sufficient supply and have not experienced any availability problems.
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