12 December 2012 23:59 [Source: ICIS news]
ICIS (LONDON)--Ethanolamines contract prices are unchanged from November to December, on the back of steady-to-firm feedstock costs and a finely balanced market, sources said on Wednesday.
Monoethanolamine (MEA), Diethanolamine (DEA) and Triethanolamine (TEA) December pre-discounted contract prices were assessed at €1,450-1,500/tonne ($1,883-1,948/tonne), €1,100-1,150/tonne and €1,490-1,560/tonne respectively.
The settlements were all on a FD (free delivered) NWE (northwest European) basis.
Ethanolamines producers and consumers confirmed that their prices were unchanged because major feedstock ethylene rolled over from the previous month, ammonia prices also held in the low $600s/tonne and the market was closing the year in a balanced position, albeit at a very low level.
In relation to the current market situation, a major buyer said: “Our production planners are being cautious, we don't have a huge demand but I hope it will pick up in January and February.”
The buyer was perplexed as to why TEA prices were “so high”.
“For TEA [prices] what is the driver? All the producers want to supply TEA especially 99 and we don't see it that strong. We are below €1,400/tonne. MEA is more or less stable. For DEA the peak is over,” the buyer said.
On the selling side, producers concurred that demand was at an expectedly low level.
Looking ahead to January, sources on both sides expect demand to come back as customers restock following a heavy period of year-end destocking.
Not every market participant however was confident that there would be a January "surge" in demand.
A buyer of all three ethanolamine grades said: “I have my doubts about the restocking. People are anxious and negotiations will be weekly and will be buying weekly.”
Meanwhile, major producer Dow said that it has announced to its customers that it will increase its price for all grades by €100/tonne effective 1 January.
“We did not take a wait and see approach and have taken a decision to announce an increase on all ethanolamines of €100/tonne,” a Dow source said.
Various reasons were given for the increase, including restocking, possible supply interruptions since producers were also coming from a very low stock position, and the high price of feedstock ethylene.
“Ethylene is still very high and basically we are lagging behind.”
Although buyers and sellers describe their December prices as unchanged, lower numbers are heard for spot material.
A trader quoted MEA at €1,350-1,400/tonne, DEA at €1,040-1,100/tonne and TEA at €1,400-1,450/tonne.
The trader said: “There are not so many changes. Demand is very weak, but this is no surprise. DEA is very quiet. TEA is the longest market and there are lots of imports coming in from Russia and Brazil.
Ethanolamines can be used for applications such as agrochemical production, surfactants, personal care and construction.
MEA is produced by reacting ethylene oxide (EO) with ammonia. The chemical reaction also produces DEA and TEA.
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