15 February 2013 23:59 [Source: ICIS news]
The contracts were concluded on a free delivered (FD) northwest Europe (NWE) basis.
February price movement was heard at plus €15-40/tonne, bringing the majority of prices into the mid-€800s/tonne FD NWE.
The upward trend was based largely on uncertainty early in the month regarding the force majeure at INEOS's 300,000 tonne/year plant in Hull, UK.
However, the force majeure was lifted on 7 February, having had only a marginal impact on the market on account of the prevailing good availability.
Increases of €20-40/tonne were heard from producers, with outcomes weighted towards the lower end of this range. Sellers described good demand and a fairly balanced market.
One suggested that feedstock ethylene costs could increase next month, which would in turn justify a rise in March VAM prices. Another producer noted that when warmer weather arrives, it should bring improved downstream demand.
A reseller based in central Europe said prices in the region are around €800/tonne FD, but it is targeting €820/tonne FD for March sales into northwest Europe. The reseller said that prices in southern Europe are around €900/tonne FD NWE.
Buyers mostly indicated February price settlements at plus €15-20/tonne, although one said it had settled some of its contracts at a rollover.
Overall, they offered a less optimistic view of demand than sellers, with one saying that offtake is low for all applications, even compared with the same time last year.
Another buyer suggested that improved supply could mean lower prices in March, but a third observed that stable ethylene prices and the imminent onset of peak season for some VAM derivatives could prompt modest increases next month.
Spot prices were assessed down by €10/tonne in the range of €830-850/tonne FD NWE.
($1 = €0.75)
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