18 January 2013 23:59 [Source: ICIS news]
LONDON (ICIS)--European January vinyl acetate monomer (VAM) contracts were assessed by ICIS in the range of €830–860/tonne ($1,107–1,147/tonne) on Friday, up by €10/tonne at the high end from December.
The contracts were concluded on a free delivered (FD) northwest Europe (NWE) basis.
A wide range of outcomes was heard on January contract prices, resulting from differing perspectives on the likely market impact of INEOS' declaration of force majeure on supplies from its Hull plant in the UK.
Sources indicated that the majority of contracts had rolled over from December, but increases of €30–40/tonne were heard in some cases.
The €10/tonne rise at the high end of the assessed range reflected contract settlements in the mid-€800s/tonne FD NWE. Spot prices were assessed unchanged at €820–860/tonne FD NWE.
US-based Celanese announced that it will increase its list and off-list prices for European VAM by €60/tonne with effect from 15 January, or as contracts allow.
Germany-based Helm informed its customers that it will increase its prices for all VAM spot sales in Europe by €50/tonne with effect from 1 February.
The question of when Switzerland-headquartered INEOS will return to normal production levels at its Hull plant continues to dominate the market.
A producer said it was still receiving additional enquiries for spot tonnes, and suggested that supply shortages could continue into mid-February.
A reseller based in eastern Europe said it had been in contact with a UK buyer, but had not concluded any spot sales. The source said that prices in Poland are at €800/tonne FD, adding that prices in the region may increase next month.
Buyers said they had seen little impact so far from the lost production, and were sceptical about producers' targeted hikes for February.
One buyer said it had bought spot tonnes at €800/tonne, while a producer concurred that the market impact from the outage has been minimal so far.
However, there is widespread acceptance that if normal production is not restored at the Hull facility by early February, the effect on European VAM availability will become increasingly severe.
($1 = €0.75)
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