26 February 2013 16:10 [Source: ICIS news]
HOUSTON (ICIS)--The March contract for US butadiene (BD) has settled at 84 cents/lb ($1,852/tonne, €1,408/tonne) among the three producers that account for more than 80% of US capacity, market sources said on Tuesday.
The March contract price is up 8 cents/lb, or more than 10%, from the February contract price of 76 cents/lb.
Two of the three producers had nominated price increases of 8 cents/lb and 10 cents/lb, respectively. Market sources confirmed on Tuesday that a third producer had agreed to the 8 cents/lb price hike, and the other producer brought its proposed price hike down from 10 cents/lb to 8 cents/lb.
A fourth supplier, which accounts for around 18% of US capacity and usually does not settle with the rest of the market, had nominated a price rise of 3 cents to 86 cents/lb. Confirmation of that settlement was unavailable.
One market source said that the price rise for March is being pushed by tight supply rather than greater demand, as well as moderate activity in the spot market.
Another market source said that long term he didn’t see much upward pressure on BD prices because of softness in Asia and concerns about margins on rubber and tyre prices.
As previously reported, sales of tyres used in new vehicles fell 16% in Europe and 2% in North America in December, while sales of replacement tyres dropped 7% in Europe and 8% in North America.
BD producers in North America include ExxonMobil, LyondellBasell, Shell and TPC Group. Buyers include Ashland, Invista, LANXESS, Michelin and Negromex.
($1 = €0.76)
Reporting by Mark Yost
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