05 February 2013 20:58 [Source: ICIS news]
HOUSTON (ICIS)--US domestic prices for epoxy resins shipped in February are expected to increase on upstream concerns, sources said on Tuesday.
Buyers and sellers said efforts by producers to push prices higher by 6 cents/lb ($132/tonne, €98/tonne) are likely to find traction.
“Securing pounds is becoming more important than the price,” a buyer said. “Security of supply is becoming very important.”
In previous quarters, buyers had been aggressively pursuing imports, mostly from Asia, because they were being done at a 3-5 cent/lb discount.
“Will imports dictate the market at the moment? No, they’re too small a part of the portfolio,” a producer said.
The upstream production slowdown is being mostly attributed to weak margins, which have been eroded by record-high or near-record-high benzene prices.
Sources added that if efforts by domestic producers to increase prices are successful, import prices will likely increase to keep their discount steady at 3-5 cents/lb.
Demand is also starting to improve for material, as the pre-building season for the key coatings market is ramping up.
“Demand has been there, unlike previous years where it was dead,” the producer said. “We know some of January was restocking and pre-buying, but February orders are looking good.”
Currently, US domestic epoxy resins prices are assessed by ICIS at $1.38-1.45/lb on a DEL (delivered) bulk basis.
Major US epoxy resins producers include Dow Chemical, Huntsman and Momentive Specialty Chemicals.($1 = €0.74)
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