10 January 2013 16:42 [Source: ICIS news]
(re-leads and updates throughout)
LONDON (ICIS)--The European cyclohexane (CX) first-quarter delta contract has been agreed at €143/tonne ($186/tonne), a rollover from the fourth quarter of 2012, buyers and sellers confirmed on Thursday.
The rollover was the result of weak demand counterbalancing high energy costs.
The CX delta settlement yields a January CX contract price of €1,296/tonne ex-works NWE (northwest Europe). The monthly CX contract price is derived from the sum of the CX quarterly delta contract price and the monthly benzene contract price.
The January benzene contract price was settled at €1,153/tonne FOB (free on board) NWE, an increase of €69/tonne compared with December.
Buyers had initially targeted a reduction in the quarterly delta contract price because of low consumption levels. Nevertheless, they said that they had agreed to a rollover as a compromise position.
“It's a compromise - at the beginning we were in a position to ask for a rebate because of weak demand, but in the end it was a rollover. Hydrogen [prices are] probably slightly better for the supplier than the preceding quarter, but the difference is very thin,” a buyer involved in the settlement said.
The downstream polyamide chain is yet to see any restocking following the start of 2013. Downstream inventories were rationalised in December to lower working capital on year-end balance sheets, and demand has been weak because of poor macroeconomic conditions.
"Now locally in Europe [there's] not much demand around, that's the general feeling, the general settlement. Not seen a single movement actually," a CX producer said.
Several buyers and sellers confirmed the CX first-quarter delta at a rollover.
One producer, however, said that it would not follow the settlement and was pushing for an increase because of high energy costs.
"What I can confirm is that we very specifically disagree with a rollover and want to distinguish ourselves from this settlement, want higher on higher energy costs," the producer said.
($1 = €0.77)
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