18 December 2012 20:31 [Source: ICIS news]
HOUSTON (ICIS)--US epoxy resins producers are looking to increase prices in January, mostly on the back of higher upstream costs, sources said on Tuesday.
Major US epoxy resins producers Huntsman and Momentive have announced price increase nominations for January.
Huntsman has nominated a price increase of 6 cents/lb ($132/tonne, €101/tonne) effective 1 January and has said it will remove a 6 cent/lb TVA (temporary voluntary allowance) from 1 September, creating a net increase of 12 cents/lb.
Momentive will seek to increase prices on epoxy resins by 6 cents/lb effective 15 January.
The third major US epoxy resins producer, Dow Chemical, has not confirmed any price increase nominations, but sources said they have announced an increase for January.
“It’s necessary when upstream benzene prices get revised upward every week,” a producer said. “And it keeps looking as though this higher benzene is here to stay.”
US benzene contract prices have increased by 17% since September, but US domestic epoxy resins prices have been steady since then on softening demand.
Buyers said the success of the producers’ efforts will hinge on what import prices do.
If traders and importers keep their prices steady, that material would be priced 4-10 cents/lb below domestic product and would likely grab extra market share, sources said.
However, if the traders and distributors raise their prices to keep their discount to domestic epoxy material closer to 2-4 cents/lb, the US producers’ efforts could find traction.
One trader said it expects importers and overseas producers to keep prices steady, rather than attempt to chase the US producers’ prices.
“If they want to go up, good for them,” the trader said. “It will just mean more business for us.”
US buyers said they don’t see demand support for prices to increase.
“Everyone is paralyzed by what’s going on in Washington,” a buyer said. “That means there’s more demand downside than upside.”
($1 = €0.76)
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