03 December 2012 06:02 [Source: ICIS news]
By Veena Pathare
SINGAPORE (ICIS)--Spot domestic values of isopropanol (IPA) in India may stay at current levels until mid-December, when imported cargoes booked at lower prices start arriving into the country, market sources said on Monday.
IPA domestic list prices in India were at rupees (Rs) 86/kg EXW (ex-works), with imported cargoes offered at Rs86-87/kg ex-tank, Kandla, they said.
“As much as 6,000 tonnes of IPA is expected to arrive at the Indian ports in mid-December, causing a spurt in supply in the Indian IPA market,” an industry source said.
With supply exceeding demand, domestic list prices may fall by Rs3-4/kg to Rs82-83/kg, the source said.
At import parity, the present domestic prices are at $1,350/tonne CFR (cost and freight) India, with December-shipment import deals concluded during the week ended 28 November at $1,340-1,350/tonne CFR India for northeast and southeast Asian cargoes, market sources said.
A number of deals were concluded for US cargoes at $1,320/tonne CFR India in October, while some northeast Asian consignments were booked at $1,330-1,340/tonne CFR India.
IPA import prices to India were stable throughout November at $1,340-1,350/tonne CFR India. But domestic prices rose sharply by Rs3-4/kg from early November to Rs86-87/kg in mid-November on short supply.
Import flows of the material into India were few last month, while local output of the material was constrained by a shortage of upstream liquefied petroleum gas (LPG) because of a shutdown at a supplier facility, market sources said.
Indian producers derive propylene from LPG for the production of IPA, according to market sources.
Northeast Asian producers who usually export IPA to India are looking at offering $1,300-1,350/tonne FOB (free on board) NE (northeast) Asia or $1,370-1,420/tonne CFR India, citing a steep increase in prices of feedstock acetone, which is in tight supply.
Acetone prices have been on an uptrend for more than a month. Acetone prices were assessed at $1,085-1,100/tonne CFR China in the week ended 30 November, according to ICIS data.
Indian demand for IPA is about 100,000 tonnes per year. Domestic production caters to about 70% of the total demand, while the rest is imported from northeast and southeast Asia.
IPA is typically used in the pharmaceutical and agrochemical sectors, as well as a solvent in the coatings industry.
($1 = Rs54.26 / $1 = €0.78)
Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections
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