Europe acetone spot prices firm again but pace slows

14 February 2013 13:08  [Source: ICIS news]

LONDON (ICIS)--European acetone spot prices have moved up again this week, but the rapid pace at which they have moved in recent weeks has slowed, market sources said on Thursday.

“In general, the market is quieter and there is not much [acetone] available below €1,100/tonne ($1,486/tonne),” a trader said.

The trader felt the acetone market had “calmed down” a little bit, but thought this was because it was mid-month and buyers were covered.

“The rapid increase of 10 days ago has calmed down and it’s normal now, but maybe because it’s mid-month,” he added.

One major producer said its acetone supply has not improved and as a result it was completely out of the spot market.

“The situation for us has become worse and to say I am short [of acetone] is an understatement. We are lacking a few thousand hundred tonnes.”

The producer did not expect the acetone supply situation to improve in the near future, particularly in light of various outages planned in the coming months.

In addition, demand for acetone is typically at its best for key acetone derivative methyl methacrylate (MMA) during the second quarter which will bring additional pressure to the market in terms of availability. 

Although the market remains “acutely tight” in Europe, some easing was felt last week because customers, in a position to stop buying, did, retreating to the sidelines because acetone had become so expensive.

Meanwhile, this week in the Benelux (Belgium, the Netherlands, Luxembourg) region, a trader quoted acetone at €1,125-1,160/tonne on an FD (free delivered) basis.

“Acetone price are stabilising, but there are not that many offers,” the trader said.

In relation to spot price development a second trader said: “It’s a wide range again. In the last few days we’ve seen business at €1,160-1,250/tonne FD for bulk business although a producer is quoting €1,300/tonne.”

Acetone is a by-product of phenol. For every tonne of phenol produced 0.62 tonnes of acetone is made.

Phenol operating rates in Europe have been running at reduced levels since the middle of July 2012 because of poor demand for phenol derivatives.

($1 = €0.74)

By: Julia Meehan
+44 20 8652 3214

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